The California Western Railroad was originally called the Fort Bragg Railroad which was built as a logging railroad in 1885. It ran from Fort Bragg CA, 40 miles eastward to Willits, CA. The line began as a vehicle for moving redwood logs to Mendocino Coast sawmills from the rugged back-country. Steam passenger service was started in 1904, extended to the town of Willits in 1911, but was discontinued in 1925. It was renamed the California Western Railroad & Navigation Company in 1905 and in 1947 the name was shortened to the California Western Railroad. The railroad was initially operated as a division of the Fort Bragg mill.

In the mid 1960s, the Kyle Railways began managing the railroad, and purchased it in 1987. In Augus 1996, a group comprised entirely of local Mendocino Coast investors purchased California Western.

The California Western Railroad bought its first Mikado No.44 from the Lamm Lumber Company of Modoc Point, OR but went to the CWR in 1944; built by Baldwin in 1937, it was retired in 1952 and sold for scrap and sent to the torch at South San Francisco shortly thereafter. It weighed slightly more than the present No.45.

CWR No.45 was built for the Brownlee-Olds Lumber Company, Medford, OR as its No.3 in 1924, it became Medford Corporation No.3 ("Medco" bought out Brownlee-Olds, so no location change) and then CWR bought the No.3 as its new No.45. No.45 masqueraded as "No.44" for the 1983 Hollywood motion picture "Racing With the Moon" and continued to wear that same paint and lettering for another couple of years before being temporarily retired for major repairs. It has long since been repainted and restored to service as No.45.

Today the California Western is run as a tourist railroad and 2-8-2, number 45 is still operational and used on many weekend excursions.