The first Rainbow Flag was designed in 1978 by Gilbert Baker, a San Francisco artist, who created the flag in response to a local activist's call for the need of a community symbol. (This was before the pink triangle was popularly used as a symbol of pride.) Using the five-striped "Flag of the Race" as his inspiration, Baker designed a flag with eight stripes. Baker dyed and sewed the material for the first flag himself — in the true spirit of Betsy Ross. Christopher Pinette, 12 June 1996
The design may have been influenced by flags with multicolored stripes used by various left-wing causes and organizations in the San Francisco area in the 1960s. The Rainbow Flag originally had eight stripes (from top to bottom):
hot pink for sex,
red for life,
orange for healing,
yellow for sun,
green for serenity with nature,
turquoise for art,
indigo for harmony, and
violet for spirit.
Handmade versions of this flag were flown in the 1978 Gay Freedom Day Parade. Steve Kramer, 24 April 1998
Use of the rainbow flag by the gay community began in 1978 when it first appeared in the San Francisco Gay and Lesbian Freedom Day Parade. Borrowing symbolism from the hippie movement and black civil rights groups, San Francisco artist Gilbert Baker designed the rainbow flag in response to a need for a symbol that could be used year after year. Baker and thirty volunteers hand-stitched and hand-dyed two huge prototype flags for the parade. The flags had eight stripes, each color representing a component of the community. Marcus Schmöger, 26 August 2001
quoting from this page
One of the latest occasions when it was used was in Washington, DC, on 28 April 2015, at the rally during the session of the Supreme Court of the USA at which the arguments were heard concerning whether same-sex marriage is a Constitutional right (ruled that it is, on 26 June 2015). The photos from the rally can be found here and here.
After the November 1978 assassination of San Francisco Mayor George Moscone and openly gay Supervisor Harvey Milk and the subsequent lenient sentence given to their killer, former Supervisor Dan White, the Rainbow Flag began to be used in San Francisco as a general symbol of the gay community. San Francisco-based Paramount Flag Co. began selling seven-striped (top to bottom: red, orange, yellow, green, blue, indigo, and violet) flags from its Polk Street retail store, which was located in a large gay neighborhood. These flags were surplus stock which had originally been made for the International Order of Rainbow for Girls, a Masonic organization for young women. When Baker approached Paramount to make flags for the 1979 Gay Freedom Day Parade, Paramount informed Baker that fabric for hot pink was not available for mass production, and Baker dropped the hot pink stripe. Steve Kramer, 24 April 1998
During the early days of the use of the rainbow as a symbol of gay pride (as opposed to gay liberation, which used the pink triangle on various colored fields) customers bought almost anything striped. At the Paramount Flag Co, the need for striped flags became acute and until the design was standardized we sold a wide variety of flags. Jim Ferrigan, 10 February 2003
Baker also asked Paramount to make vertical banners that would be split and displayed from the angular double bars of the old-style lamp posts on Market Street. Baker and Paramount's vice president Ken Hughes agreed to drop the hot pink and turquoise stripes and replace the indigo stripe with royal blue — resulting in three stripes on one side of the lamp post and three on the other. Steve Kramer, 24 April 1998
Soon the six colors were incorporated into a six-striped version that became popularized and that, today, is recognized by the International Congress of Flag Makers. Christopher Pinette, 12 June 1996
Gilbert "Clive" Baker, a San Francisco-based activist and artist best known for creating the rainbow flag representing gay rights, has died at the age of 65, his longtime friend announced on social media on Friday.
"My dearest friend in the world is gone. Clive Baker gave the world the rainbow flag, he gave me forty years of love and friendship," Cleve Jones said on Twitter.
No details were immediately available on the cause of Baker's death or where he died. According to the biography posted on his official website, he had been living in New York City.
Jones also tweeted a photo of Baker with former President Barack Obama, inviting mourners to meet him under a rainbow flag in the Castro district of San Francisco on Friday evening to remember his friend.
Baker, who was born in Kansas in 1951, was stationed in San Francisco in the early 1970s while serving in the U.S. Army, at the start of the gay rights movement.
According to the website biography, Baker began making banners for gay rights and anti-war protests, often at the request of Harvey Milk, who would become the first openly gay man elected to public office in California when he won the 1977 race for a seat on the San Francisco Board of Supervisors.
Milk rode under the first rainbow flags made by Baker at the San Francisco Gay Freedom Day Parade in June 1978, just months before the politician was murdered by a former city supervisor, the biography says.
Regarding the gay pride rainbow flag, there was a good article in the Flag Bulletin [tfb] some years ago that gave a long history of rainbow flags and their use as a symbol of hope for difficult causes. At the NAVA conference in Sacramento, Steve Tyson, a former employee of the former flag company, Paramount Flag Co., in San Francisco presented a lecture on the origins of this particular flag. Apparently, he had taken remnants, scraps of flag material and gone to the production department to make decorative flags to use up the scrap material. He showed several variations. The horizontal stripes (with white in the center) become popular. The company chose to produce it (without the white stripe) and from there it was adopted as a gay pride flag. I am not familiar with the actual procedure of the adoption by the gay community although I think Mr. Tyson did make some reference to that. Herold Lee, 8 January 1998
There is no "International Congress of Flag Makers" that "recognizes" flags. This is a suppositious organization. It has never existed. We see it often in association with the Rainbow Flag in San Francisco. What this is a contraction of two names, the English version of FIAV, or the International Association of Vexillological Associations, and Flag Congress. The term Flag Congress was the meeting name of the joint meetings FIAV XII and NAVA XXI, held in San Francisco, CA, in the Summer of 1987. The largest such meeting ever held, hosting over 150 vexillologists from 16 nations. The "International Congress of Flag Makers" was inadvertently created by Gilbert Baker when he was interviewed by the representatives of the Gay press in San Francisco, during Flag Congress. During that interview Mr. Baker confused the organization FIAV and the event Flag Congress. The result was this supposed organization. By "recognition" he was in fact referring to the paper I presented at Flag Congress entitled "The Evolution and Adoption of the Rainbow Flag in San Francisco," in which the full details of the Rainbow Flag are chronicled. It was published as [fer89]. James Ferrigan, 25 March 1999
What's this "five-striped Flag of the Race," which supposedly inspired the gay rainbow flag? The only such flag I know, la bandera de la raza, shows three purple crosses and a sun — no stripes at all. António Martins, 20 April 1999