Sources provide very different information about the company's origins. Some internet sources believe that it was founded in 1849 by Carlo Castagna. According to another account, the company goes back to the Milanese carriage manufacturer Paolo Mainetti, who was founded in 1835. Its owner took the then nine-year-old Carlo Castagna into his company as an apprentice in 1849 or 1864. Over the years, Castagna rose to senior positions, according to this source. In the 1890s he became director of the company and partner. Under his leadership, Mainetti gradually bought up local competitors Albini, Enrico Orsaniga and Eugenio Ferrari and merged them to form Ferrari, Mainetti & Orsaniga. In 1894 Carlo Castagna took over the majority share in this company. After a restructuring and the participation of new investors from the Milanese aristocracy the company was given the name Fabbriche Riunite die Carrozze già Mainetti, Ferrari ed Orsaniga di C. Castagna in 1901, which was shortened to Carrozzeria Carlo Castagna in 1906.

In 1905, Castagna shifted the company's activities to the construction of automobile bodies. After Carlo Castagna's death in 1914, his son Ercole, born in 1885, initially took over the management of the company alone; In 1919, Carlo Castagna's younger son Emilio also joined the company. Emilio Castagna was responsible for designing numerous automobile bodies in the 1920s. At the beginning of the 1920s, the factory site reached a size of 32,000 m2. Castagna had 400 employees and produced around 100 bodies per year. After the company became the largest Italian body manufacturer in the  1930s,  producing bodies for companies such as Isotta FraschiniDuesenbergAlfa RomeoLancia, and Mercedes-Benz, production of civilian automobiles came to a standstill at the beginning of the Second World War. In 1942, the factories in Milan were completely destroyed in a bombardment. Emilio Castagna, who had already left the family business in 1940, founded an independent company in Milan, Carrozzeria Emilio Castagna, which existed until 1960 and primarily produced small series based on Fiat models.

After the end of the war, Ercole Castagna and the parent company moved into new production facilities in the Lombard community of Venegono Superiore. The attempt to build on the successes of the pre-war period failed. Castagna still designed and built some special bodies for Alfa Romeo and Lancia chassis, but given Italy's economic difficulties in the early post-war period, it did not find enough customers to continue the company permanently. In 1954 Carrozzeria Carlo Castagna ceased operations.