The "environmental sculpture" - made the same year that California relaxed its marijuana laws, earned him an A grade,The Cannabist reported last year.
The team also amended it to "Holywood" for Easter 1976; to "Ollywood" to protest Marine Lieutenant Colonel Oliver North amid the Iran-Contra hearings in 1987; and to "Oil War" during the Persian Gulf War in 1990.
Finegood and his pals defended his work against claims that it was vandalism in a letter to The Times in 1983.
"We broke no laws and did no damage to the sign," they wrote in a letter.
"An artist's role throughout history has been to create representations of the culture he exists in. By hanging four relatively small pieces of fabric on the landmark, we were able to change people's perception of the Hollywood Sign."
Finegood died of multiple myeloma in January 2007 at age 52. Though this latest alteration appears to be inspired by his work, it's not known if there is a direct connection.
As Californians awoke - or left house parties - on Sunday morning, social media lit up with photos and chatter about the prank.
Singer Alex Sloane tweeted: "It's 7:01am & I just got home and the Hollywood sign says 'Hollyweed'? Really tho guys."
Star Trek: The Next Generation actress Gates McFadden was more impressed by how the pranksters braved the elements to amend the sign. "There is a new sign out my window! How did they do it in the rain?!" she tweeted.
A spokesperson for the LAPD said that a lone male was caught on surveillance footage climbing the mountain with coloured tarp at about 3am. He then scaled the scaffolding at the back of the letters and draped the tarp over them to transform the letters. The figure - who was dressed all in black - then jumped down and ran off the mountain.
The change wasn't spotted by police until 5am, when officers noticed the amendments, the spokesperson said. If the prankster is caught they will be charged with misdemeanour trespassing, the officer said.
Workers began taking down the tarps at around 12.30pm on Sunday.
