[1] He had seven siblings: James Sears, John Calvin, Henry Franklin, Charlotte Judith, Mary, Charles, Caroline Waldo, and Theodore Francis.

On arrival in California, he joined one of his brothers prospecting near the South Fork Feather River on Oregon Creek.

In 1880, while living in San Bernardino, Waterman discovered a silver mine with John Porter a few miles north of Barstow, then called Grapevine.

In 1886, Waterman purchased Rancho Cuyamaca in San Diego County, including California's Stonewall Jackson gold mine.

During his governorship, the "Waterman Rifles" militia, named in his honor as a prior resident, was authorized for San Bernardino.

In 1889, possibly at Waterman's urging, the 300-acre (120 ha) Harlem tract in Patton was chosen for the first Southern California Insane Asylum.

After his governorship ended on January 8, 1891, he moved to San Diego, where he purchased for $17,000 a Queen Anne-style house built in 1889 at 2408 First Avenue, now known as the Long-Waterman Mansion.

On May 14, 1881, Robert Waterman agreed in writing to give his brother within 12 months on demand 24/100ths of mining property in California.

James also held five promissory notes dated late 1881, for $10,000, payable from February to March 1882 at 8 percent per annum interest.

The notes were transferred by Robert Waterman to Philander M. Alden and George S. Robinson, citizens of Illinois and executors of James' estate.