The dark 1957 Western Run Of The Arrow is the first Hollywood movie to use blood squib effects. Prior to the 1960s, onscreen violence tended to be somewhat tame. If a character was shot, for instance, it was taboo to show the shooter and victim in the same frame. This would be relaxed in the 1960s, where films like Sam Peckinpah's The Wild Bunch and Bonnie And Clyde featured graphic sequences of characters being shot.
By the time the 1980s rolled around, movies like RoboCop or John Woo's The Killer featured blood squibs being used by the gallon load. Squibs refer to tiny explosive devices that are used to simulate bullet hits, with blood squibs being filled with fake blood. The 1955 Polish movie Pokolenie - AKA A Generation - by director Andrzej Wajda is the first documented case of a blood squib being used in a film.
While there's conflicting information about which Hollywood movie was the very first to use a blood squib, all signs point to 1957's Run Of The Arrow. This gritty Western stars Rod Steiger as a Confederate soldier called O'Meara, who fires the last shot of the Civil War. Refusing to accept defeat, he decides to the Sioux so he can continue the fight. He's allowed to them after surviving a grueling initiation - the titular run of the arrow - and takes a wife and adopts a mute child. While he swears an oath to fight for his tribe, when he's entrusted to make peace between them and the U.S. Calvary, O'Meara is left with no easy options.
While the violence featured in Run Of The Arrow is relatively mild by today's standard, it was bitting for its time. Soldiers are shot with arrows and characters suffer when wounded. Director Sam Fuller was known for making tough genre movies with conflicted anti-heroes and tackling difficult themes like racism and war head-on. One of his most famous projects is the World War II movie The Big Red One, starring Lee Marvin and Mark Hamill (Star Wars: The Last Jedi). His treatment of violence was inspired by his own experiences in the war, and there's nothing glossy or slick about it.
The blood squib used in Run Of The Arrow still has the power to shock since it's so jarring to see an effect like that used in a 1950's film. The movie is praised by movie fans today for its treatment of the subject matter, and while a number of it's Native Americans characters are distractingly played by Caucasian actors - most notably Charles Bronson (Django Unchained - a movie that definitely used its share of blood squibs.