The town of Gridley was named after its founder and earliest landowner, George W. Gridley. He was born in the state of New York and later moved with his parents to Galena, Illinois. In 1850 he attempted to drive sheep and cattle across the plains to California. He lost the animals, but arrived safely himself and settled in this area.
As early as 1852, he was prospering in the stock business, and with ten thousand dollars profit, he returned to Illinois. Again he started back to California with a large herd of sheep. This time, six hundred survived. That was enough to give George Gridley his start in the sheep raising business. He prospered in this venture, and his home ranch consisted of some 960 acres (3.9 km2) located West of Gridley. He married Helen Orcutt in Illinois, and she joined him in California in 1855. The Gridleys had ten children. Mr. Gridley died at the home ranch in 1881, Mrs. Gridley twenty years later. Descendants of the Gridley family are still in the area today.
With the decline of mining, agriculture became a more stable and attractive business in the 1860s. The Central Pacific Railroad laid tracks from Oregon to Chico in 1865. The railroad completed its path to Gridley in 1870, and that is when the community of Gridley began to form. The principal products from the Gridley area were wool and sheep. Orchards, field crops, and cattle would soon follow. In 1896, the Hunt Cannery was established and became one of the largest peach canning operations in the world. It now operated as the Tri Valley Growers.
The first home and store in Gridley were build by L.C. Stone in 1874. Stone served as postmaster, the train depot and express agent, as well as a merchant. Wells Fargo & Co. opened its office in 1871 and soon other businesses followed suit.
Two large fires, one in 1884 and one in 1891, destroyed much of the original business district. The district rallied and rebuilt around 1900.
Much of the historic downtown district remains. "Silk Stocking Row" the many well-preserved turn-of-the-century homes on Hazel Street, was so named because during the Depression the only women who could afford silk stockings lived in these large Hazel Street homes.
The post office at Martinsburgh was moved to Gridley in 1870.
According to the United States Census Bureau, the city has a total area of 1.6 square miles (4.1 km²), all of it land.
Butte County geographer, Steve Herman, released the locally-popular "My Baby's Gone to Gridley," as a B-side to the 45rpm "This Is Oroville" in 1987. The tune can be downloaded: There is also a website dedicated to the song:
As of the census of 2000, there were 5,382 people, 1,841 households, and 1,266 families residing in the city. The population density was 3,427.6 people per square mile (1,323.6/km²). There were 1,963 housing units at an average density of 1,250.2/sq mi (482.8/km²). The racial makeup of the city was 66.57% White, 0.32% Black or African American, 1.54% Native American, 3.47% Asian, 0.02% Pacific Islander, 24.06% from other races, and 4.01% from two or more races. 38.63% of the population were Hispanic or Latino of any race.
There were 1,841 households out of which 36.7% had children under the age of 18 living with them, 48.0% were married couples living together, 15.3% had a female householder with no husband present, and 31.2% were non-families. 26.5% of all households were made up of individuals and 15.1% had someone living alone who was 65 years of age or older. The average household size was 2.86 and the average family size was 3.48.
In the city the population was spread out with 30.1% under the age of 18, 10.0% from 18 to 24, 25.3% from 25 to 44, 18.6% from 45 to 64, and 15.9% who were 65 years of age or older. The median age was 33 years. For every 100 females there were 91.3 males. For every 100 females age 18 and over, there were 86.2 males.
The median income for a household in the city was $24,368, and the median income for a family was $29,957. Males had a median income of $28,347 versus $24,444 for females. The per capita income for the city was $12,267. About 19.5% of families and 23.3% of the population were below the poverty line, including 34.8% of those under age 18 and 5.8% of those age 65 or over.