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The flag was created on 31 January 1890. The blue represents the immense sky of Mato Grosso; the white peace; and the green the rich vegetation. The star symbolizes the state, and is yellow to represent the color of the gold that attracted to the first colonists.

The following is the text of the 1890 decree on the Mato Grosso flag: Decree No 2 of 31 January 1890 Art. 1 - The special flag of the Federal State of Mato Grosso shall be blue with a white lozenge, on the center of which shall be a green globe and a yellow star with its rays touching the circumference of the sphere.The decree was revoked by state law 1046 of 8 October 1929 and reinstated by article 140 of the 11 July 1947 state constitution.

This is one of the oldest flags in Brazil, having been created by the first governor of the state, Antônio Maria Coelho, only 73 days after the adoption of the national flag of the republic. The colors and general design are the same as the national flag, but the arrangement of the colors is reversed (the field blue and white and the globe and star green and yellow. According to the International Association of Lions Clubs and the state government, the blue symbolizes the sky and the spiritual search for perfection. The white lozenge is said to be a Positivist symbol of reverence for the female principle. White signifies purity, the band of the zodiac, peace, political concord, virtue and optimism. The green sphere or globe expresses the sovereignty and the territorial dimension of the state. Green also characterizes hope and youth, and (nowadays) the need to preserve nature in harmony with socio-economic growth. The star is said to be another positivist symbol signifying humanity's turning to the firmament in search of symbols and answers to the many quests that arise across the centuries. The yellow recalls gold as one of the riches of Mato Grosso, as well as the bandeirante explorers. It also symbolizes light, culture, wealth, power and glory, and authority based on wisdom.