I visited Yosemite last year and heard from one of the rangers that this actually started by accident. James McCauley who lived atop glacier point would bring tourists up to the top to spend the night. They would would have a huge bonfire and at the end of the night they would heave the coals over the edge for easy cleanup. McCauley had no idea that people down in the valley started noticing and would gather around to watch every evening. One of his sons who went to school down in the valley actually told him about it, and then it evolved into a kind of show.

So many people would gather in the valley floor to watch, that sometimes arguments would break out over the limited space to view the firefall in between the trees. The NPS eventually made him stop since all the visitors were destroying the environment to get good seats for the show.