[2] The modern neighborhood was founded by Cleve and Elizabeth (Heald) Purington on about eighty acres in the 1920s, the community was subdivided into small cabin lots geared towards non-permanent residents.

As a canyon community, Sleepy Hollow has been threatened several times by major fires, including in 1929, 1958, and 1990, all of which brought the loss of homes in the neighborhood.

In November 2008, the massive Freeway Complex Fire burned to the very edges of the community and forced the evacuation of nearly all of its residents for three days, but, incredibly, no homes were lost.

The City of Chino Hills has developed an evacuation and emergency access system for Sleepy Hollow and other neighborhoods within the Canyon.

While development to the east since the late 1980s has greatly increased commuter traffic on Carbon Canyon Road, the neighborhood still retains a country feel that belies the suburbanization that goes on around it.