<P> By 1912, major motion - picture companies had set up production near or in Los Angeles . In the early 1900s, most motion picture patents were held by Thomas Edison's Motion Picture Patents Company in New Jersey, and filmmakers were often sued to stop their productions . To escape this, filmmakers began moving out west, where attempts to enforce Edison's patents were more easily evaded . Also, the weather was ideal and there was quick access to various settings . Los Angeles became the capital of the film industry . The mountains, plains and low land prices made Hollywood a good place to establish film studios . </P> <P> Director D.W. Griffith was the first to make a motion picture in Hollywood . His 17 - minute short film In Old California (1910) was filmed for the Biograph Company . Although Hollywood banned movie theaters--of which it had none--before annexation that year, Los Angeles had no such restriction . The first film by a Hollywood studio, Nestor Motion Picture Company, was shot on October 26, 1911 . The H. J. Whitley home was used as its set, and the unnamed movie was filmed in the middle of their groves at the corner of Whitley Avenue and Hollywood Boulevard . </P> <P> The first studio in Hollywood, the Nestor Company, was established by the New Jersey--based Centaur Company in a roadhouse at 6121 Sunset Boulevard (the corner of Gower), in October 1911 . Four major film companies--Paramount, Warner Bros., RKO, and Columbia--had studios in Hollywood, as did several minor companies and rental studios . In the 1920s, Hollywood was the fifth - largest industry in the nation . By the 1930s, Hollywood studios became fully vertically integrated, as production, distribution and exhibition was controlled by these companies, enabling Hollywood to produce 600 films per year . </P> <P> Hollywood became known as Tinseltown and the "dream factory" because of the glittering image of the movie industry . Hollywood has since become a major center for film study in the United States . </P>

When did hollywood become the movie capital of the world