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A brief note on how to install and setup PostgreSQL for Ruby on Rails on Mac OS.

Install PostgreSQL
Install pgAdmin

Prerequisites

This note assumes that Ruby on Rails has already been properly installed and the purpose is to replace the default DB engine SQLite with PostgreSQL.

Install PostgreSQL

As shown in the official Postgres download instructions here, there are few ways of installing PostgreSQL on Mac OS. Homebrew or Postgres.app are the common ones that often recommeded by other Mac users.

However, as I also use Linux and Windows machines for development, installing PostgreSQL using grapichal installer from EnterpriseDB would be a more widely used solution that keeps everything consistent across all my environment. This grapichal installer provides an easy and straightforward wizard to get Postgres installed with few simple clicks.

Download

Go to https://www.enterprisedb.com/software-downloads-postgres
Select a version. (For example, the latest installer version is Version 9.4.0).
Click 'Mac OS X' to download for Mac.

Install

Install from the downloaded file postgresql-9.4.0-1-osx.dmg just like any other Mac installers.
Follow through the installation wizard with the default options.
Installing Stack Builder is optional and can be omitted.

Add to PATH

Locate where PostgreSQL's binary is. By default, it should be /Library/PostgreSQL/9.4/bin/psql, where 9.4 is the PostgreSQL version number. Otherwise, use the following find command to find the path.
sudo find / -name 'psql'
Open ~/.bash_profile with following command.
open ~/.bash_profile
Add the following line to .bash_profile using the PostgreSQL's binary path.
PATH=$PATH:/Library/PostgreSQL/9.4/bin

Install pgAdmin

pgAdmin is the most popular and feature rich Open Source administration and development platform for PostgreSQL. It helps users manage PostgreSQL databases through graphical interfaces.

Install

Download Mac OS dmg installer from https://www.pgadmin.org/download/macos4.php.
Install it (e.g. the latest is pgadmin3-1.20.0.dmg).

Connect to server

Open up pgAdmin III from the applications.
The local DB should be already shown up in Obeject Browser -> Server Groups -> Servers -> PostgreSQL 9.4 (localhost:5432). If not, manually add a server pointing to localhost:5432 or the port number specified when installing PostgreSQL.

Install pg gem

Open up a terminal window
Find out where pg_config is using the command below. By default, it should be /Library/PostgreSQL/9.4/bin/pg_config for PostgreSQL 9.4.
sudo find / -name 'pg_config'
Install the gem with pg-config path explicitly specified.
gem install pg -- --with-pg-config=/Library/PostgreSQL/9.4/bin/pg_config

Update Ruby on Rails project

Update 'Gemfile'. Replace gem 'sqlite3' with gem 'pg'.
Run bundle install.
Open config/database.yml file and update it like the following:

Original (for SQLite):