The cooperative National Weather Service station reports that Occidental has cool, wet winters and warm, dry summers.
Average January temperatures range from 41.8 °F (5.4 °C) to 54.5 °F (12.5 °C) and average July temperatures range from 51.4° to 77.9 °F (25.5 °C). The record highest temperature was 103 °F (39 °C) on July 22, 2006, and the record lowest temperature was 28 °F (−2 °C) on March 11, 2006. There are an average of 12.8 days with highs of 90 °F (32 °C) or higher and an average of 2.1 days with lows of 32 °F (0 °C) or lower.
Average annual rainfall is 55.19 inches (1,402 mm). The wettest year was 1983 with 111.21 inches (2,825 mm) and the dryest year was 1976 with 20.75 inches (527 mm). The most rainfall in one month was 36.62 inches (930 mm) in January 1995. The most rainfall in 24 hours was 8.51 inches (216 mm) on January 5, 1966. Average annual snowfall is only 0.2-inch (5.1 mm). The maximum snowfall was 11.0 inches (280 mm) in January 1974.
Founded in 1876, Occidental was a stop on the North Pacific Coast Railroad connecting Cazadero to the Sausalito ferry. In return for donating right-of-way to the railroad, a local landowner named "Dutch Bill" Howards received a lifetime railway pass, and the station was named after him.
As of the census of 2000, there were 1,272 people, 524 households, and 319 families residing in the CDP. The population density was 255/sq mi (99/km²). There were 632 housing units at an average density of 127/sq mi (49/km²). The racial makeup of the CDP was 92.77% White, 0.55% African American, 0.79% Native American, 1.18% Asian, 0.24% Pacific Islander, 1.57% from other races, and 2.91% from two or more races. Hispanic or Latino of any race were 4.64% of the population.
There were 524 households out of which 32.3% had children under the age of 18 living with them, 46.2% were married couples living together, 10.3% had a female householder with no husband present, and 39.1% were non-families. 27.1% of all households were made up of individuals and 5.2% had someone living alone who was 65 years of age or older. The average household size was 2.40 and the average family size was 2.91.
In the CDP the population was spread out with 22.8% under the age of 18, 7.6% from 18 to 24, 27.7% from 25 to 44, 33.3% from 45 to 64, and 8.6% who were 65 years of age or older. The median age was 41 years. For every 100 females there were 99.7 males. For every 100 females age 18 and over, there were 100.0 males.
The median income for a household in the CDP was $54,000, and the median income for a family was $71,375. Males had a median income of $46,806 versus $29,306 for females. The per capita income for the CDP was $25,970. About 7.9% of families and 9.8% of the population were below the poverty line, including 13.7% of those under age 18 and none of those age 65 or over.
Occidental is unique for its high concentration of visionaries and famous artists during recent history, and was the hub of community-centered social movements in the late 1960s and early 1970s, giving rise to nearby communes such as Morningstar, Wheeler Ranch, and Star Mountain.
There was a point in the early 1990s when the town was also a center of the "neo-hippie" movement in Sonoma County, but high property prices and other economic pressures have since driven out the young families that fed this movement.
For many years Occidental has been known for its Italian restaurants, which serve generous family-style dinners for a fixed price (following the European custom). The two main Italian restaurants today are the Union Hotel (founded in 1879) at 3703 Main Street and Negri's at 3700 Bohemian Highway.. More recently, the large number of craft breweries in the area have made Barley and Hops Tavern, in downtown Occidental another local and tourist destination.