Harmony grew up around a dairy founded in 1869. Until 1907 the creamery changed hands several times, and in those early days rivalries and feuding among dairy farmers caused chaos in the valley. After one shooting death, a truce was called, and all agreed to live henceforth in harmony, from which the town derived its name. In 1907 M.D. Salmina established the Harmony Valley Cooperative Dairy, and the town prospered with this business. In its heyday the village included a large residence for management, bunkhouses for employees, a general store, a livery and stable, blacksmith, feed store, post office, and a school house. The dairy produced milk and cream as well as some of the finest butter and cheese in the state. In those days Highway 1 ran right through town, and motorists were treated to ladles of buttermilk from the dairy. William Randolf Hearst was a familiar face as he stopped for fresh dairy products on his way to his ranch, and Rudolf Valentino and Pola Negri also stopped there on their way to visit Hearst. Eventually the dairy business shifted to San Luis Obispo, and in the late 1950s Harmony Dairy closed. For many years the town was abandoned except for the post office, which remained open, until restoration began in 1972 to bring back the beauty and vitality of earlier years.