The Orange County Local Agency Formation Commission, or OC LAFCO, is a government agency that makes decisions regarding boundaries for cities, unincorporated territory (land not located within a city) and special districts (local agencies which provide water, sewer, parks and recreation and other municipal services) within Orange County, California. Orange County LAFCO offices are located in Santa Ana, California.

Following World War II, Orange County experienced a dramatic growth in population and economic development, increasing the demand for housing and public services. The population in Orange County grew from 216,224 in 1950 to 703,925 just ten years later in 1960. By 1970, the County’s population exceeded 1.4 million residents. As development pressures increased to serve Orange County’s growth, land developers tried to find the fastest and most cost effective means of providing basic municipal services such as water, roads, fire protection and sewers. Often this was done without consideration of the long-term consequences on municipal service delivery to Orange County residents.

During the 1950s and early 1960s, some Orange County cities began to haphazardly add annex territory to their boundaries to serve newly developing areas. In addition, numerous special districts were created – many of them with overlapping boundaries, which created inefficiencies and higher costs for residents. To address these issues not only in Orange County, but throughout California, Local Agency Formation Commissions were established by the State Legislature in 1963 in each California county.

In 1985 the Commission approved the annexation of the 82-acre "Spotted Bull" area with roughly 30 homes into San Juan Capistrano.

That same year, the Commission also approved a ballot measure for voters in the Mission Viejo area to decide whether to form a community services district, which was then seen as a step prior to full incorporation. Following overwhelming approval of the district vote, residents moved forward towards full incorporation. Afterwards, a 1987 study found that an incorporated Mission Viejo would have a surplus if incorporated.

In 1986, another community services district ballot measure was approved for the Laguna Niguel area despite a staff recommendation against the proposal after receiving support from Supervisor Thomas F. Riley. That vote, originally scheduled for June 1986 was pushed back to November following community outcry.

After a previous incorporation bid failed in 1970, the communities of Dana Point and Capistrano Beach considered a joint application for incorporation in 1986. Capistrano Beach residents had previously supported annexation into the city of San Juan Capistrano, but soured on the idea after a different annexation went through. Annexation into San Clemente also wasn't popular, following 18 different previous annexations of Capistrano Beach territory.

A 1986 law by Assemblyman Bill Bradley increased the cost of new incorporations. That law further prompted Mission Viejo, Laguna Niguel, Dana Point, Capistrano Beach, and the new proposal of North Tustin to submit incorporation applications.