Why did Americans take and increased interest in the environment during the 1970s? How did government respond?

The short answer is that it became impossible to ignore.  Decades of largely unrestricted pesticide use (DDT in particular), industrial pollution, fish kills in rivers and streams and lakes, contaminated groundwater and "cancer clusters" near industrial sites made the news repeatedly and continually.  This sensitized and convinced the public that environmental protection was necessary.

This was true even in the early 1970s, as most people don't remember that Richard Nixon signed the Clean Air and Water Act, perhaps the most important environmental legislation to date.  It had an almost immediate positive effect on air and water quality.