I've lived in California most of my life (we emigrated here when I was a child). I think the perception people have of "California style" is often different from what you see i.r.l. The geographic divide has an impact: I think northern and southern California have distinct style differences.
Most people think of a bohemian, surfer-girl vibe (originating in SoCal) when they think "California", with faded jeans and tees/tank tops or loose blouses. This look also often incorporates ethnic touches like Mexican embroidery, and ethnic fashions like Asian-style tunics, ikat and batik prints, and/or "hippie"-ish jewelry made of beads, strips of leather, etc. Two brands that exemplify this style are Free People and Gypsy 05, much loved by many Californian women I know (including me!).
This kind of surfer/boho style can also morph into a very hippie/nature-girl vibe that's *huge* here in northern California, where I live. On one extreme you'll find lots of tie dye, clothes and footwear made of "green" fabrics like hemp, etc. But most people prefer the middle-of-the-road jeans, tees and sandals (or Uggs in winter) look that may or may not incorporate touches of tie dye and other hippie-style standbys. This always seemed more NorCal to me, but I might be wrong since I haven't been in SoCal in years.
In the San Francisco bay area, I've often find that many young women adore vintage style, showcased in such blogs as Calivintage, Fashionist, and The SF Style. Vintage is popular here in the Sacramento valley where I live too, but mainly in cities or college towns.
But most Californians are suburbanites, and dress more or less the same way other people who live in suburbs all over the USA do: lots and lots of bootcut jeans or capri pants, tees or collared, fitted woven tops, sweatshirts or sweaters, flip-flops (even in January) or flats or Uggs, and Coach bags everywhere. I sometimes think I'm the only female in this state who does not own or carry a Coach bag, lol!
If I had to pick one word to describe California style, I'd probably choose "casual". I think women dress a bit more casually here than in other parts of the country, even when they're dressed up and/or wearing expensive/dressy clothes. I don't know why. Laid-back and comfortable clothes are valued here, even for church services and weddings. This often drives me crazy because I don't think casual clothes are appropriate for formal or religious events, but I might be in the minority with that opinion!