After splitting off from the Carson party at Angels Creek, John and
Daniel Murphy headed east looking for likely prospects. The brothers
reached Coyote Creek in October of 1848, and after a few pans showing
good color, they set up camp and christened the site Murphys Diggings.
The boys worked the stream for a few months and then decided to move on
and search for better diggings. They eventually settled down about six
miles away, where the
y founded the camp now known as Murphys, afterwhich their original camp
was referred to as Murphys Old Diggings.
Mexican miners began to drift into the abandoned camp, which they
re-named Vallecito, meaning "small valley" in Spanish. They built
their camp in the typical fashion of their homeland, starting with a
central plaza around which they put up their first buildings, brush
ramadas and canvas tents. More substantial adobes and stone buildings
soon followed as the town began to grow.
The quiet, sleepy camp was abruptly shaken in 1852, when extremely
rich deposits of gold were discovered running practically through the
center of town. The camp boomed and changed so drastically, that within
a year it hardly resembled its former self. Several saloons and
fandangos were among the first new enterprises to appear, closely
followed by provision stores, boarding houses, blacksmiths, livery
stables, a dry goods store, a school, a church, and several fraternal
organizations which included the Sons of Temperance, the Masons, and
the Odd Fellows. Due in part to the large number of miners in the area,
a post office was established on August 17 of 1854, which is still in
service today.