CADMV claims on their web site that they cannot accept a P.O. box as a residence address. I have yet to find anything in California state law supporting this policy, though IANAL. Their enforcement seems to be quite lax.
You cannot literally use "P.O. box" but if you use the virtual street address service the USPS offers now it works just fine.
You cannot literally use "P.O. box" but if you use the virtual street address service the USPS offers now it works just fine.