Tesla continued research in the field and, later, observed an assistant severely "burnt" by X rays in his lab. He performed several experiments prior to Roentgen's discovery (including photographing the bones of his hand; later, he sent these images to Roentgen) but didn't make his findings widely known; much of his research was lost in the 5th Avenue lab fire of March 1895.

A "world system" for "the transmission of electrical energy without wires" that depends upon the electrical conductivity of the earth was proposed in which transmission in various natural media with current that passes between the two points are used to power devices. In a practical wireless energy transmission system using this principle, a high-power ultraviolet beam might be used to form a vertical ionized channel in the air directly above the transmitter-receiver stations. The same concept is used in virtual lightning rods, the electrolaser electroshock weapon, and has been proposed for disabling vehicles.

Tesla demonstrated "the transmission of electrical energy without wires" that depends upon electrical conductivity as early as 1891. The Tesla effect (named in honor of Tesla) is a term for an application of this type of electrical conduction (that is, the movement of energy through space and matter; not just the production of voltage across a conductor).

On 30 July 1891, he became a naturalized citizen of the United States at the age of 35. Tesla established his 35 South Fifth Avenue laboratory in New York during this same year. Later, Tesla would establish his Houston Street laboratory in New York at 46 E. Houston Street. There, at one point while conducting mechanical resonance experiments with electro-mechanical oscillators he generated a resonance of several surrounding buildings but, due to the frequencies involved, not his own building, causing complaints to the police. As the speed grew he hit the resonant frequency of his own building and, belatedly realizing the danger, he was forced to apply a sledgehammer to terminate the experiment, just as the astonished police arrived. He also lit electric lamps wirelessly at both of the New York locations, providing evidence for the potential of wireless power transmission.

Some of Tesla's closest friends were artists. He befriended Century Magazine editor Robert Underwood Johnson, who adapted several Serbian poems of Jovan Jovanović Zmaj (which Tesla translated). Also during this time, Tesla was influenced by the Vedic philosophy (i. e. Hinduism) teachings of the Swami Vivekananda; so much so, that after his exposure to Hindu-Vedic thought, Tesla started using Sanskrit words to name some of his fundamental concepts regarding matter and energy.