The Groovy Guy contest was started by Sam Winston in 1968 as a marketing tool for the newly formed Advocate magazine and as a way to unite the Los Angeles gay community around a contest that moved away from drag events. The co-sponsor of the first contest was the gay club The Hayloft, where the first contest was held.

The event was organized by Bob Barnett and John Charles, of Too Guys Productions, with the Advocate staff doing advertising. The first contest had seven contestants and 150 people in the audience at the August 19th event. Local LA area bars submitted applicants to be considered for the contest. The bars that participated in the first event were the Blue Angel West, De Paul's, Klondike, Right Pocket, River Club, Sax Club, Seventh Keg, Tony Honker, and the Valli Haus.

Word of mouth created such a buzz that by the following year there were eighteen contestants and 700 people in the audience.