Reiner named the company in honor of the fictional Maine town from the book The Dead Zone written by Stephen King (which was named after the fictional Castle Rock in Lord of the Flies), after the success of the film Stand by Me (produced by Norman Lear's Act III Communications), which was based on a novella by King. The first Castle Rock release was When Harry Met Sally….
The company was backed by Columbia Pictures and Nelson Entertainment. Nelson was primarily interested because of some of the founders' relations with the company. Horn previously was with Embassy Pictures, which Nelson later acquired. Reiner filmed two successful films for Embassy, This is Spinal Tap and The Sure Thing. Nelson was also involved with the home video distribution of Reiner's The Princess Bride which Reiner also co-produced with Scheinman. Nelson funded Castle Rock's films and also distributed the films on video. Some of Nelson's holdings were later acquired by New Line Cinema, which took over Nelson's duty. Columbia invested at formation, distributing Castle Rock's films theatrically, but shortly thereafter had to re-invest with a substantial change in terms when accumulated losses exhausted its initial funding.
Columbia handled Castle Rock films' distribution up until 1999. Despite the company's history of being sold and acquired, it never turned in a profit until its 2004 computer-animated production of The Polar Express, which is now in perpetual holiday theatrical release.
In 1994, Castle Rock was acquired by Turner Broadcasting System, which was eventually merged into Time Warner. In 1999, Warner Bros. and Universal assumed distribution rights beginning with The Green Mile (WB handled domestic distribution, while Universal handled the foreign rights). In 2003, WB assumed full distribution of all Castle Rock films worldwide.
The worldwide home video and European theatrical rights to all Castle Rock films up to 1994 (with the exception of co-productions with Columbia such as In the Line of Fire and A Few Good Men) are now owned by MGM (having inherited some holdings from Nelson Entertainment), while the remaining rights as well as post-1994 Castle Rock films (except the US rights to The Story of Us and The Last Days of Disco, along with the international rights to The American President, all of which are held by Universal) are now part of WB's library.
Theatrical distribution of the pre-1994 Castle Rock library came full circle in 2005, when MGM was sold to a Sony-led partnership. As Sony owns Columbia (through Sony Pictures Entertainment), that studio has assumed theatrical distribution rights to the MGM-owned features. SPE also handled TV and video distribution for a short time. In 2006, MGM returned to self-distribution on TV, and switched video distribution to 20th Century Fox.
The Castle Rock Entertainment title music was composed by Marc Shaiman.