The Bay to Breakers race debuted in 1912 as a way to get San Franciscans' minds off of the ongoing construction to rebuild the city following the 1906 Earthquake. Now its organizers claim that it's the oldest continuous footrace in the world whose course has never changed. It runs 7.46 miles across the city from The Embarcadero to the Great Highway, near Ocean Beach.
The first known instance of someone running in costume occurred in the 1940s, according to the San Francisco Chronicle, when someone dressed as Captain Kidd. But costumes didn't really take off until the 1980s, and today that's pretty much all you see.