Incorporated in 1924, CBC became Columbia Pictures Corporation. Offices were set up along a section of Gower Street and Sunset Boulevard in Hollywood known as "Poverty Row" because it was home to several low-budget film production companies. Each year brought new developments and growing revenues for the fledgling operation. Its greatest catalyst, however, came in 1927 with the discovery of director Frank Capra.

In its early years, Columbia Pictures was known for the production of a large volume of low-budget movies. This reputation began to change when, in 1927, the studio hired a young director named Frank Capra, who created Columbia’s first all "talkie" feature, THE DONOVAN AFFAIR. His directing talents contributed to a number of "firsts" for the studio but none greater than Columbia's first Best Picture Academy Award® for its 1934 film, IT HAPPENED ONE NIGHT, which swept the top five awards and put Columbia on the map. Capra went on to direct a number of classics for the studio including MR. DEEDS GOES TO TOWN, YOU CAN'T TAKE IT WITH YOU (Best Picture Oscar® in 1939) and MR. SMITH GOES TO WASHINGTON.

With Columbia’s increased respect and prestige during the '30's and '40's, the Cohn brothers were able to expand their studio acreage in Hollywood. In 1935, they purchased additional property in Burbank to use as a back lot for location filming. Among the many stars under contract at the time were Rosalind Russell, Rita Hayworth, Glenn Ford and William Holden, all adding luster to the Columbia name.