It was in Los Angeles in 1941 that Carl Karcher and his wife, Margaret, found a hot-dog cart on Florence and Central for sale for $326. They borrowed $311 on their Plymouth, added $15 of their own, and bought the brightly colored stand. Although the sign on this first stand read HUGOS HOT DOGS, Karcher began purchasing more carts, painting on them CARLS HOT DOGS. In 1945 Karcher opened his first drive-thru restaurant, which he names Carls Drive-In Barbecue. In 1956 he opened two smaller restaurants in Anaheim and Brea, California, and used the Carl's Jr. name for the first time.

With 630 units as of 1991, the chains trademark smiling star can be seen throughout the West and Southwestern United States, as well as in Mexico, Japan, and Malaysia. The chain has come a long way from the days when Karcher used to mix the secret sauce in twenty-gallon batches on his back porch. Carl's Jr. takes credit for introducing salad bars to fast-food restaurants back in 1977. Today, salads are regular fare at most of the major chains.

Carls top-of-the-line hamburger is still the flame-broiled Famous Star, one of several products that has made Carl's Jr. famous.