When the Stars Moved to Malibu: Elizabeth Taylor, Marilyn Monroe and A-Listers on the Beach

Lou Ferrigno and Billy Crystal in 1978

Sex in cars, Margot Kidder topless, Sean Penn and Madonna on bikes: The early days, when real estate was cheap, were Hollywood's playground frontier.

In 1930s Malibu, writes Robert Wagner in You Must Remember This, "You could lease a lot with 130 feet of ocean frontage for $30 a month." Soon, surfers Gary Cooper and Ronald Colman moved in, as did Barbara Stanwyck and Frank Capra (whose house Tom Hanks later lived in).

Recalls Lee Majors, who moved to Malibu after his split with Farrah Fawcett in 1980: "I bought a place on the widest part of the beach, sight unseen. Larry Hagman and Burgess Meredith were neighbors and best friends until Larry blocked Burgess' view, so they quit speaking."

PHOTOS Malibu: Elizabeth Taylor, Marilyn Monroe on the Beach

Chance encounters were frequent: Robert Redford cast Mary Tyler Moore in Ordinary People after she walked by on the beach, and Mike Nichols hired Buck Henry to write The Graduate after meeting him at Jane Fonda's 1965 all-night beach party, where, "in a car, a very well-known writer [had sex] with a very well-known actress," says Henry.

Topless sunbathers included Margot Kidder (eyed by Steven Spielberg and Brian De Palma) and Sue Mengers. "You'd see somebody on their deck drinking wine and go up and join them," says Majors. "Carry your own glass down the beach, and get it filled up at every other house. Sting, Barbra Streisand and Shirley MacLaine were there. You'd see Sean Penn and Madonna bicycling by."

When the area got too crowded, Majors left, renting out his house for $175,000 a month. Says Majors, "Malibu was wonderful."