Three men confronted the bus driver, Frank Edward "Ed" Ray and the 26 children, aged between 5 to 14, and hijacked the vehicle with all of them inside.
Frederick Newhall Woods IV, 24, and brothers James Schoenfeld, 24, and Richard Schoenfeld, 22, held them captive in box truck in a rock quarry up north near Livermore.
The kidnapping was intended for a ransom demand of $5 million.
WATCH: Chowchilla kidnapping: When and where police caught the three men behind the bizarre crime
Sixteen hours later, Ray and the children dug their way out of the quarry and escaped unharmed.
"There was a white van parked down the road with the door open," said Ray at a news conference the night of the rescue. " I slowed down over to the white line to go around them, and jumped out a man with two guns with a mask on. He ordered me to open my door. The other two guys jumped out of the van. One ordered me to the back seat and the other took over the bus."
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All three suspects were eventually arrested, convicted and sentenced to life in prison.
In June 2012 at age 57, Richard Schoenfeld was granted parole and released from prison. Three years later, his older brother James was released.
In 2019, Frederick Woods, the mastermind behind the crime, was denied parole for the seventeenth time and is still serving time in prison. His next parole hearing is scheduled for 2024.
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At Woods' parole hearing in 2012, victim Jennifer Brown Hyde gave a heartbreaking account of what life had been like for the kidnapping victims.
"I wrote that they buried me alive, they stole my childhood and caused me immense emotional pain over the years. It affected my life, my parents' lives and my children's lives," she said.
"For me, it's having to deal with hatred and anger toward other human beings, and that's a struggle that almost 40 years later I still have to deal with. "Until recently I slept with a night light. I have anxiety attacks when I'm in a confined space," she revealed. "I'm fortunate I'm not incarcerated or hooked on drugs, which is how some of the kids dealt with it. I'm as OK as a broken person can be."
Ray, the bus driver, passed away in 2012. February 26 was named Edward Ray Day in the town of Chowchilla.
The Associated Press contributed to this report.