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Populated for thousands of years by the Melanesian Torres Strait Islanders , who named the island Waiben (thought to mean 'dry place', owing to the scarcity of fresh water on the island), Thursday Island’s first reported sighting by Europeans was in 1607 by Spanish explorer Luis Vaez De Torres . Lieutenant James Cook first visited in 1770 and annexed the island, along with the eastern half of Australia, to the British Crown, which permanently settled the island in 1877 .

A lucrative pearling industry was founded on the island in 1885, attracting workers from around Asia , including Japan , Malaya and India , seeking their fortune. Additionally, many south Pacific Islanders were also imported to work in the industry, many against their will. While the pearling industry has declined in importance, the mix of cultures is still in evidence today.

During World War II , Thursday Island became the military headquarters for the Torres Strait and was a base for Australian and United States forces. As a result, the island was bombed by the Japanese in 1942 , which saw the evacuation of civilians from the island. They would not return until after the end of the war.

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The Melanesian background of the Thursday Islanders became an issue in the 1970s as Papua New Guinea sought to include the Torres Strait Islands within their borders. The Torres Strait Islanders insisted that they were Australians however and after considerable diplomatic discussions, all of the Torres Strait, including Thursday Island, remained as part of Australia.

The economy of the island is supported by pearling and fishing, as well as a fast developing tourism industry, with perhaps the most famous tourist being novelist Somerset Maugham .

English is the official language of Thursday Island, although Torres Strait Creole is predominant on a social level {Link without Title} .

The Thursday Island township is also noteworthy for being the most northerly town in Australia. The TAFE Institute is the leader in education for the Torres Strait.