The island was named for the Kiawah (KEE-a-wah) Indians, who inhabited the island through the 1500s.
In 1699, Kiawah Island was granted to Captain George Raynor by Lords Proprietors under the auspices of King Charles II of England. Raynor was not interested in Kiawah so he sold half and willed the other half to his daughter, Mary. The entire island was then purchased by John Stanyarne in 1737. After his death the island was split between his two granddaughters, Mary Gibbes and Elizabeth Vanderhorst.
Over the next 130 years the island passed down through the families of the granddaughters until Adele Vanderhorst purchased the western half of the Kiawah for $3,500 in 1900.
Fifty years later, the Vanderhorst estate sold the island to C. C. Royal, a lumberman from Aiken, South Carolina, for $125,000. Over the next 24 years, Royal logged pine trees, built the causeway to Kiawah, developed Eugenia Avenue by selling oceanfront lots for $10,000 each, and put in east-to-west logging roads, the precursors to today's paved roads.
In 1974 Royal sold the island to the Kuwaiti Investment Corporation for $17 million. Development of the island began in earnest.
In 1988 Kiawah Resort Associates purchased the Kiawah from the Kuwaitis for $105 million, and sold the amenities for $35 million to Landmark. The amenities were later sold to Kiawah Island Golf Resort.
Also in 1988, the Town of Kiawah Island was incorporated.