When missionaries established the Mission Santa Cruz in 1791, they noted "an area to the east of the San Lorenzo River "in sight of the Sea" that was crisscrossed by "steep gulches containing running water" and three "reed-lined" lagoons.

Spanish colonial settlers, who later established the secular pueblo of Villa de Branciforte on the east side of the San Lorenzo, ran their herds of cattle and horses in the "common lands" of this area.

Francisco Rodriguez was granted a rancho bearing the name "Los Esteros" (never patented)[citation needed] because of the sizeable estuaries forming two of its boundaries.

With the discovery of gold in California in 1848 and American statehood in 1849, legal maneuvering turned the Rodriguez brothers' holdings over to a handful of white settler-farmers.

The Live Oak School District has maintained a facility at this location, now the intersection of 17th Avenue and Capitola Road, to the present day.

By the start of the 20th century, fifty years of wheat and oat farming had depleted the soil such that farmers turned to cultivating fruits and vegetables.

Owing to the irrigation needs of these crops, these farms eventually failed and were replaced by a large poultry operation near the present-day intersection of Capitola Road and Soquel Drive, and a floriculture bulb nursery (specializing in callas, narcissus, freesias and begonias) near the present-day intersection of 17th Avenue and East Cliff Drive.

Around 1910, two Santa Cruz real estate agents, the brothers Frank and David Wilson, purchased and subdivided several of the old 19th century wheat farms.

The new lots were long and narrow, normally of 2.5 acres (1.0 ha), and came with a "poultry unit" that included a kit for a two-bedroom house, and one or two large chicken coops stocked with a flock of 500 or 1,000 hens and roosters.

Egg and poultry prices plummeted in the early years of the Great Depression, and this difficulty was compounded by a double plague of Pullorum Disease and Coccidiosis, which swept through the chicken coops of Live Oak in 1931.

Bulb nurseries, particularly those specializing in begonias, thrived throughout this period and into the 1950s, when the area was beginning to develop into a residential suburb of Santa Cruz.

The west-to-east serial numbering of Live Oak's north–south streets during that period reflected the expectation that the area would soon be annexed to the city of Santa Cruz.

Annexation never came, and a movement for Live Oak to incorporate itself as a municipality was abandoned too, in light of the expense of providing the needed services to the area.

[4] Sporadic infill development in Live Oak over the last half century has contributed to the area's eclectic patchwork of trailer parks, ranch-style houses, townhome condominium complexes, and single-family homes in cul-de-sacs, with the 2½ acre plots and their two-bedroom kit houses left over from the chicken farming days (the farms are no longer operating).