As the story goes the last Song Emperor asked what the name of this area was, and was told that it was 'Nine Dragons', because of the eight hills that ringed the area. When asked where the ninth dragon was, he was told that it was His Imperial Highness himself. Of course this is all legendary, and another theory of its name is that nine clans settled in this area, all surnamed 'Loong', or dragon. The truth is hard to ascertain today.
What can be said is that a number of hillside fortifications were set up in a ring around the main town of Kowloon, including one in Tsim Sha Tsui where the Signal Hill Tower stands today. The town itself was also fortified heavily in 1847, with the Chinese fearing an incursion by the British, not to mention the increased depredations of pirates in the neighborhood. But they had no idea when they built it that it would be needed for the Taiping Rebellion of Hong Xiuquan, the man who thought he was Christ's younger brother and unleashed a holocaust that annihilated 20 million people over a 15-year period starting in 1850. Given the world population of that time, it could very well have been the most apocalyptic man-made episode in world history. This quasi-Christian cult took advantage of the declining efficacy of Qing rule, the fact that they were foreign, and that they had lost a war to foreign invaders as a way of re-establishing moral Chinese rule.
By 1854, the Taiping Rebellion came to Kowloon. As Eitel says,
"Things got so bad that the violence spilled over onto the new British colony of Hong Kong island, which had tried to stay neutral in the conflict:
city, opposite Kowloon Hong Kong, was at the end of September, 1854, repeatedly taken and retaken by the Rebels and the Imperialists. The former closed in upon from all sides and commenced a blockade of the Canton Canton Riverwhich caused the junk trade of city to migrate for a time to Canton Hong Kong... The capture by the Taipings, of the Hoifung and Lukfung district cities (in the NE of Hongkong) in September, 1854, seriously interfered, for a time, with the market supplies of the Colony."
"Armed bands of Taipings also paraded the streets occasionally, until the police (December 21, 1854) stopped it by arresting, in the Lower Bazaar, several hundred armed rebels who were about to embark to attack Kowloon city. About the same time the Governor issued a Neutrality Ordinance (No. 1 of 1855) to regulate the exclusion from the harbour of armed vessels under the contending Chinese flags and the manufacture and sale of arms and ammunition. Since September 1854, there was at anchor in the harbour a fleet of war-junks under the command of an alleged prince (Hung Seu-tsung) of the Taiping Dynasty who, with his officers, fraternized with the local Chinese Christians and some of the Missionaries. More than a week elapsed after the passing of that Ordinance without its being acted upon and meanwhile the Colony narrowly escaped (January 23, 1855) the danger of a naval battle being waged in the harbour, as nine war-junks, carrying 2,000 Imperialist soldiers, arrived and anchored west of the Lower Bazaar whilst a large number of Taiping war-junks were lying close to the Hospital-ship Minden. After much delay, however, both parties were ordered off and peacefully departed in different directions."These problems caused piracy to increase in the district, which resulted in the Qing authorities searching and often seizing every boat in the area, whether armed or not. This is what led to the British agreeing to allow Chinese merchants to purchase the right to fly British flags on their junks after they were certified not to be pirates.
It was the Qing seizure of a Chinese merchant ship called the Arrow, flying a British flag, that touched off the Second Opium War. And it was the depredations of the Taipings and the anarchy they caused around Kowloon City that could be said to be its proximate cause.