Benjamin Holt, incorporated the Holt Manufacturing Company in 1892. He had previously been in business with his brothers in the Stockton Wheel Company which designed and produced combines, wheels and harvesters. Holt was very interested in finding solutions to the issues with current farm machinery (???) and solved many issues relating to the use of combines. he then truned his attention to the problem of using big heavy machinery on boggy or less solid ground. Holt used known ideas and created new ones in mounting a a pair of crude wooden tracks on a steam engine from whcih the wheels had been removed. Holt was credited with producing the first practical continuous tracks for use with tractors and he registered "Caterpillar" as a trademark in 1910. The Holt Manufacturing Company was the first company to successfully manufacture a continuous track tractor.

Holt's main competitor was C.L. Best, who owned the C.L. Best Gas Traction Company. Since Holt had trademarked Caterpillar, Best named his tractors Tracklayers. In 1911, Holt began building the "Holt Model 60 Caterpillar" in its Stockton plant and a "Holt Model 40-60 Caterpillar" at its East Peoria factory.Additional models followed, including the "Holt Model 60-75 Caterpillar", which sold very well, eventually renamed as the "Holt Model 75 Caterpillar", their best-selling front tiller-wheeled tractor.By the early 20th century, Holt Manufacturing Company was the leading manufacturer of combine harvesters in the US, and the leading California-based manufacturer of steam traction engines. Holt Manufacturing Company operated from Stockton, California, until opening a satellite facility in Walla Walla, Washington, to serve the Pacific Northwest. In 1909 Holt Manufacturing Company expanded by purchasing the facility of defunct farm implement maker Colean Manufacturing Company in East Peoria, Illinois. Holt changed the name of the company to Holt Caterpillar Company, although he did not trademark the name Caterpillar until 1910.

Holt introduced as military tractors, the 'Ton' series during the first World War. They became available to the public in 1919. The ton series consisted of the 5-ton, 10-ton and 2 ton.

The company's initial products focused on agricultural machinery and were distributed internationally. During World War I, almost all of its production was military materiel. Its tractors were widely used by the Allies to supplant horses pulling haul heavy artillery and tow supply trains. Holt tractors also played a part, to varying degrees, in the development of military tanks in Great Britain, France, and Germany. Holt's equipment was credited with helping the Allies to win the war.

The Holt Manufacturing Company gained worldwide recognition for the quality and durability of its equipment.[citation needed]

As the war ended, the Holt company was left with huge surplus inventories of heavy-duty tractors ill-suited for the agricultural market, which had been dominated during the war by the Holt Company's primary competitor, C. L. Best. The company decided to focus instead on heavy construction equipment and sought to capitalize on the passage of the Federal Aid Highway Act of 1921. Laden with debt and needing more capital to switch its product line, the company struggled to move forward.

Both the Holt Manufacturing Company and C. L. Best were hurt by the depression of 1920–21 which further inhibited sales. Both companies streamlined their over-lapping product lines. The two companies had spent about US$1.5 million (about $20,931,689 today) in legal fees fighting each other in various contractual, trademark and patent infringement lawsuits since 1905. On the advice of investors, the two companies merged in 1925 to form the Caterpillar Tractor Company