The county's second public junior college was formed in 1936 as a part of San Luis Obispo High School District but ceased operation in June 1959.

[4] Five years later, following the approval of a $5 million bond,[5] Cuesta broke ground on its current main campus west of Camp San Luis Obispo to establish a 127-acre site including frontage property deeded to the college by the National Guard.

[7] With a 14-inch telescope including a special narrow wavelength-band filter, the observatory has been used since the 1970s, occasionally open to the public for viewing of events such as visible comets[8] and solar eclipses.

Since April 2009, Cuesta's main campus has hosted acclaimed authors to speak at its annual Book of the Year event series, including Julie Otsuka for the debut visit,[15] Sonia Nazario in 2010,[16] Novella Carpenter in 2011,[17] Vanessa Diffenbaugh in 2013,[18] Kevin Powers in 2015,[19] Hector Tobar in 2016,[20] Rebecca Skloot in 2017,[21] Ron Suskind in 2018,[22] Ana Castillo in 2019,[23] Tommy Orange in 2022,[24] Sabaa Tahir in 2023, and Myriam Gurba in 2024.Cuesta's Paso Robles campus opened a new student center featuring a cafeteria, student lounge, and Pearson VUE-administered CBEST and CSET testing stations, in June 2018.

[25] Also in 2018, the college's San Luis Obispo campus received a $1.5 million gift from the Harold J. Miossi Charitable Trust; the donation toward Cuesta's Cultural and Performing Arts Center was the second-largest in the institution's then-55-year history.

[28] The complex hosted the silver medal-winning U.S. men's national water polo team and the gold medalist synchronized swimming duo of Tracie Ruiz and Candy Costie during training sessions for the 1984 Summer Olympics.

The Tribune, the local newspaper of San Luis Obispo, described this as the result of a "years-long struggle to fix several deficiencies identified by the commission [that] came at a cost: lower enrollment, difficulty recruiting applicants and damaged morale".

[40][41] With regard to students passing the National Council Licensure Examination (NCLEX), Cuesta's registered nursing graduating class of 2023 ranked as the top-scoring program across California.

[45] Several of the Cougars' programs compete in Dr. Stork Gym, which in the mid-1980s to early 1990s garnered local attention for hosting the SLO County Basketball Camp, which on multiple occasions featured clinics including instructor Bill Walton.

[51] In the history of the Western State Conference, Cuesta accumulated 10 WSC North Division championships from 1981 through 2016, the second-most in the league; only Ventura College (with 13 such titles) won more in that time span.

The Cougars' highest finish in the state tournament has come in 2006, as the team placed sixth after advancing to the California Finals held at Big League Dreams Sports Park in Redding.

[56] Cuesta's men's water polo team, which has compiled more than 40 consecutive winning-record seasons,[57] has advanced to the CCCAA final four on four occasions since 2005, including finishing in third place in the state in 2006[58] and 2023.

The Cuesta women's water polo squad, which owns four WSC championships since 2000,[59] saw its single-season goals record broken in 2022 by Arroyo Grande High School recruit Anna Kreowski (who scored a state-leading 142 times before transferring to Cal Baptist).