In 1945 Clarence Leonidas (Leo) Fender and Doc Kauffman started building lap steel guitars in Fullerton, CA. In 1946 Kauffmann left and Leo Fender founded The Fender Electric Instrument Manufacturing Company, soon to become a staple of American guitar manufacturing.
Fender created the Esquire and the Broadcaster (soon renamed the Telecaster) in 1950 and became the first company to manufacture and successfully market solidbody guitars. They created the first mass-produced electric bass, the Precision Bass, in 1951. The now iconic Stratocaster guitar debuted in 1954.
The Telecaster was Fender's first big hit but by the time Jimi Hendrix appeared with an upside down Strat (he was a lefty) during the 1960s the Stratocaster was on its way to becoming the most recognizable and most copied electric guitar design in the world (Gibson's Les Paul being its cheif competition).
In early 1965, Leo Fender sold the company to the Columbia Broadcasting System. Quality suffered as a result of this sale. In 1981 Bill Schultz (formerly of Yamaha) was named president by CBS and within a few years Schultz, with a group of other Fender employees, had negotiated the purchase of the company from CBS. It was renamed the Fender Musical Instruments Corporation.
Quality has ebbed and flowed from year-to-year since the birth of the Fender Musical Instruments Corporation but has generally trended upward, at least with regard to their American made guitars -- now built in Corona California. The core of Fender's line, the Telecaster, Stratocaster, Precision Bass, and Jazz Bass, remain very true to the 1950s and 1960s originals.