Deer Lodge (Salish: sncwe) is a city in and the county seat of Powell County, Montana, United States. The population was 3,111 at the 2010 census. The city is perhaps best known as the home of the Montana State Prison, a major local employer. The Montana State Hospital in Warm Springs, and former state tuberculosis sanitarium is in nearby Galen are the result of the power the western part of the state held over Montana at statehood due to the copper and mineral wealth in that area. Deer Lodge was also once an important railroad town, serving as a division headquarters for the Chicago, Milwaukee, St.