Castle Rock was home to the nomadic Indians of the area, primarily Arapaho and Cheyenne. The weather in the area was good; they were shielded from the worst winter storms found in the mountains and the extreme heat and desert-like conditions found on the Plains to the east. At the same time, they had easy access to the lodge pole pines, as well as herds of buffalo, antelope and deer. Their lives were good before the Gold Rush and the railroad brought thousands of newcomers to the area.
Jeremiah Gould was one of the original white homesteaders in the area. In 1874, after Castle Rock became the County Seat for Douglas County, Gould donated 120 acres of land to what became known as the town of Castle Rock. White settlers continued to move in and take over land opened through the Homestead Act of 1864. The nomadic Indians of the area were forced off their lands and followed their food sources for survival.
Things changed dramatically in 1872 when rhyolite stone (used for building exteriors) was discovered south of Castle Rock in the area now known as Plum Creek. Silas Madge built the first quarry there in 1872.
The Denver & Rio Grande Railway established a train depot in Castle Rock the next year. It brought supplies for the ranchers, transported rhyolite from the local quarries and cheese from the dairy farms in the area. Today Castle Rock is home to many people who work in Denver but enjoy the small town feeling of the community.
The town is named for a natural rock formation adjacent to the town which is in the form of a castle. During the Christmas season, a lighted star shines like a beacon from the "castle rock"