(FORTUNE Small Business) – For as long as the California garage has housed convertibles, it has also fotered a different type of vehicle: innovation. Although Hugh Hefner started at his card table and Tom Golisano in his old boss's office, it's the garage that's achieved iconic startup status, thanks to entrepreneurs like Mattel's Elliot and Ruth Handler, whose L.A. garage was their first workshop. Or Arthur Melin and Richard Knerr, who not only launched fad factory Wham-O from a Pasadena garage in 1948 but also encouraged and embraced the ideas of other "garage entrepreneurs" to produce hits like the Super Ball. Ultimately, though, it was the success of three businesses--Disney, HP, and Apple--and the interconnections between them that transformed the California garage into a metaphor for American ingenuity.

The story begins with Walt Disney and the three attempts--and three garages--it took him to launch a successful animation company. After an early failure in his garage in Kansas City, Disney headed to Hollywood in 1923. He settled into his uncle's Los Angeles garage to produce joke reels for local movie houses. That gave him leeway to pursue cartoon work at night; his first creation, Oswald the Rabbit, became so successful that he was able to move from the garage into larger quarters. Unfortunately, Disney got caught in a contractual bind with his distributor--and the distributor poached most of his animators to produce future Oswald cartoons without him. "Never again will I work for somebody else," Disney vowed as he set up a secret workshop in his garage at home to keep his latest brainstorm--a black-eared mouse named Mickey--away from his turncoat animators.

While finishing Fantasia 15 years later, the Disney company stumbled across a startup in Palo Alto selling the sound-testing equipment it needed--an audio oscillator--for much less than the competition. The startup, composed of David Packard and Bill Hewlett, had set up shop in Packard's garage in 1938. "I knew that if Packard's car was in the garage, it meant they had no orders," said Frederick Terman, the duo's mentor. "But if it was out in the street, they had some business and were soldering, wiring, painting--you name it." Their big break came with the oscillator for Disney, the first in a long line of scientific-testing products.

Hewlett and Packard also became well known for conscientious management and commitment to the community (called the "HP way"). That included taking a phone call from a local 12-year-old who wanted some parts to build a frequency counter. "Hewlett ended up giving me a summer job," said Steven Jobs. "What I learned there was the blueprint we used for Apple." Inadvertently HP played another role in Apple's development when in 1975 it scoffed at HP engineer Stephen Wozniak's side project, a rudimentary personal computer. Former high school friend Jobs didn't. When Wozniak's young wife got tired of tiptoeing around the stacks of electrical components in her living room, the two migrated to Jobs' parents' garage, after his father removed all his car-restoration equipment. The space became Apple's drafting board, manufacturing plant, and shipping department, but as a boardroom it failed: When the duo finally convinced an investor to visit their "office," he balked at funding the scruffy entrepreneurs, partly because of their provincial surroundings. Jobs and Wozniak finally found someone willing to put up $91,000 in cash, and Apple graduated to a real office, where they built the Apple II.

The garage bond came full circle when Jobs established Pixar in 1986 with a former Disney animator; five years later he set up a deal with Disney to develop movies like Finding Nemo. Every garage entrepreneur hopes to leave the garage one day--but only physically. "'Garage' is a state of mind," says Guy Kawasaki, a former Apple engineer who named his venture capital firm Garage Technology Ventures to celebrate its inspirational ideal. "It's a rejection of the status quo. It's 'I don't need dozens of engineers and marketers with MBAs to clean the competition's clock.'"