The very earliest known inhabitants of Caspar were, of course, the Pomo Indians. The closest large encampment was Booldam at the mouth of Big River to the north but a smaller village was known to exist at Pine Grove. Carbon dating of some of the materials found in the traditional encampment areas have established that humans lived in the region as long ago as 3,000 years before the birth of Christ. It is not known for certain who these people were but sometime during the most recent millenium the Pomo were clearly established in the Caspar area.
One of the first white settlers on record to establish himself in the Caspar area was Captain Peter Thomson. Thomson first came through what is today Caspar in April 1852 and he built a cabin in Pine Grove a mile south of the town. Thomson was a hearty "frontiers-man" who had roamed the Apache country in 1830s and had gone to South America with Kit Carson a few years before he decided to settle in Caspar. A chronicle written in 1879 noted that he continued to live in Caspar and led "as wild a mountain life as the country will afford."
The name of the town seems to have been derived from another early resident - a German trapper named Kaspar. Kaspar ran a string of traps along Caspar Creek and collected bobcat, cougar, fox, otter, weasle, mink and racoon pelts which he sold to the fur trade. Kaspar's origins are not recorded but it is suspected that he might have been a deserter from one of the ships from Europe that were begining to ply the coast in the mid 18th century.
The increased demand for lumber which followed the discovery of gold eventually impacted Caspar. At about the same time that Thomson was establishing himself in Pine Grove a Henry Meiggs built the very first saw mill on Caspar Creek. Several other mills followed close behind and by the late 1870s Caspar was producing 45,000 board feet of lumber a day. The mountain man had given way to the lumberjack. Lumber from Caspar was transported by doghole schooner far and wide. Some of it was used to build the very first wooden house in Pasadena, California in 1878.
The man who eventually emerged as the leading lumber baron in Caspar was Jacob Green Jackson. Born in Vermont in 1817, Jackson's father and his grandfather had both fought at Bunker Hill. Jackson earned the title "Captain" by navigating a ship from Australia back to San Francisco. The navigator had perished in Austrailia and Jackson taught himself how to navigate in order to make the return trip. A giant of a man in more than one way. He established the Caspar Lumber Company and made it one of the most successful lumber ventures on the Wild Coast. He died in 1901.
The Caspar Lumber Mill closed its doors on November 18, 1955 and an era closed with it. Today the highway passes the town by and almost all of the thousand people who lived there during it's heyday are gone.