Construction began on a road through the Kern Canyon in the mid 1890's. The road was graded dirt and extended from the mouth of the canyon (15 miles east of Bakersfield) to the site of Southern California Edison's KR1 powerhouse about two miles inside the canyon. This road was built by Edison Electric for constructing their Kern River powerhouse between 1902 and 1907. When completed, KR1 was the largest hydroelectric facility in the world and boasted the longest, most powerful transmission line (75,000 volts) which stretched 118 miles from the plant, over the Grapevine to Los Angeles.

In late 1919, Highway 178 (then known as Legislative Route 57) was added to the State highway system and was called "The Walker Pass Route" for the pass the road covers on it's way to the desert junction of Freeman. The state highway bond issue of 1919 allowed for the grading of the road between the KR1 powerhouse and Democrat. The grading was done by convict labor from Folsom Prison Camp 9 and was completed in 1924 at a cost of over $530,000. The severe cost of the grading was due to the steep sides of the canyon wall and the rock that had to be blasted out of the way to make the roadbed. "The Canyon" as it is known to locals, is notorious for its many and usually dangerous curves. It is an intimidating road with a steep rocky canyon wall on one side and the mighty Kern River on the other.

Many have died along the highway as a result of it being narrow and curvy. Several improvements have been made to eliminate or improve curves and improve sightlines. One thing that has not changed since the 1920's is the frequency of rock slides that occur as a result of expansion and contraction of the canyon wall due to rains and temperature. The Tehachapi earthquake of 1952 also caused many major rock slides. Many floods, including those in 1940 and 1942, washed away several portions of the road. Floods were a threat until Isabella reservoir was completed in 1953. Until the late 70's, a sign at the mouth of the canyon told travelers that this dangerous road was not patrolled at night and travel was at your own risk.

The first reference to any highway between Democrat and Bodfish is in a Bakersfield newspaper article from 1905 mentioning newly-opened County Road 148. This primitive road diverged off Breckenridge Road near Mt Adelaide and passed over the mountains, down to Democrat Springs and then along the canyon to Bodfish. The county of Kern improved the 17 mile section of road from Democrat to Bodfish and turned it over to the State for maintenance as part of the State Highway on January 1, 1926. The county turned the rest of the mountain road over to the U.S. Forest Service and is now known as road 28S09 and is accessible only by four wheel drive vehicles.

Between 1905 and 1959, Democrat Springs was a resort that featured hot mineral springs and a hotel. Local ranchers and travelers stopped at the hotel for meals and to soak in the waters. The Democrat property has since changed hands many times and with the 'high-speed' road between the Kern River Valley and Bakersfield, the resort was passed by. What is left now are fenced-off ruins that are a part of local history.

Highway 178 also passed through the small village of Miracle Springs. Miracle featured a hotel, general store, campground, hot springs and even its own Post Office. The end of this community began in 1966 with fire destroying the Hot Springs Hotel and ended in 1986 with a fire destroying the remaining general store. The Forest Service finished the job by closing the area, clearing the remains of all buildings at Miracle Springs and reopening the area to public use in 1992. The Location signs for Miracle Springs were removed by the County in 1987.

At Miracle, the state route connected with a road already established in 1897 by the Pacific Light & Power Company for building their Borel powerhouse. This road was maintained by the County and went from the "hobo" camp at Miracle Springs to the junction with the county road to Caliente at Bodfish. At this intersection, 178 turned left, went down Bodfish Grade and continued past the landmark Borel Flume. This overhead waterway was built in 1902 to feed the Borel powerhouse three miles to the west. It was replaced by an underground pipe in 1997 due to seismic concerns and its frequent leaks.

Continuing north through Hot Springs Valley, the road made an abrupt left turn and entered the small communities of Garfield and Kernvale before cutting through the "new" town of Lake Isabella. In 1966, the state authorized an upgrade of 178 to four lane expressway from China Gardens, east of Democrat to Isabella Dam. This improved 13-mile section opened on October 13, 1973. While this new section cut four miles off the trip, it took seven years to construct due to political and funding difficulties as well as the large amount of grading that was necessary for the new alignment. At the time, it was one of the most expensive stretches of expressway in California. The new "freeway" also bypassed the towns of Miracle Springs, Bodfish, Garfield, Kernvale and Lake Isabella. The old highway through Kernvale & Lake Isabella was upgraded to four lanes prior to state relinquishment in 1974 and is now known as Lake Isabella Blvd. The stretch of replaced road from China Garden to Bodfish is now known as Old Canyon Road. (County Road 214)