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(Information and graphics courtesy of BLM and DelMarVa On-Line)
Assateague Island is an Atlantic coastal island which straddles the Maryland / Virginia line. Its halves are separated by a fence which runs along the state boundaries. The island is inhabited by two herds of Chincoteague horses. The herd on the Maryland side of the island is managed by the National Park Service. The herd on the Virginia side is owned by the Chincoteague Volunteer Fire Company which has a grazing permit for the animals. A common belief is that a Spanish galeon laden with livestock sank offshore and the survivng animals swam to the island. Equally probable is that early settlers abandoned some stock on the island which then flourished.
Breeds of Livestock - The Assateague PonyThe Ponies on AssateagueThis is not a BLM operated or BLM sponsored site. It is run by private wild horse and burro enthusiasts. We are thankful to the BLM for providing much of the information which is presented here and to DelMarVa On-Line for the "penning" photo. 
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Horses have been penned on Assateague and Chincoteague islands since the
early 1800s. The islands could only support a finite number of animals and
penning was a way to control their numbers. Today wild horse herds remain only
on Assateague island and excess horses on the Virginia side are swum to
Chincoteague Island anually (during low tide) and are auctioned off by the
Chincoteague Volunteer Fire Company to raise money for fire and rescue
equipment.