The island was named by lake mariners for its location, placed 'through the charity of God' at the entrance to Saginaw Bay midway between the city of Au Gres, Michigan and "The Thumb". The island was offered for sale in 1987 for $750,000. Ten years later, in 1997, more than 80% of the island was acquired by the U.S. Fish and Wildlife Service as an addition to the Michigan Islands National Wildlife Refuge (MINWR) system. The island is largely forested, mainly with mixed hardwoods. The humid ecoclimate is friendly to a diverse herbarium, including some rare plant species. "Its isolated beaches and unique hardwood forest provides excellent habitat for a variety of plants and animals. Many rare and protected species of plants grow on the Island including: Pitchers Thistle, acres of Trillium, Jack in the Pulpit, and Pink Lady Slippers.
The island is best known among mariners for its former lighthouse. Charity Island Light was constructed in 1857. It operated in 1857-1930 and was then replaced by the Gravelly Shoal Light. The lighthouse complex stands on a land parcel within the island that was not added to the MINWR.
Geologically, the island contains pockets of chert that are believed to have been quarried by Native Americans. Offshore, the gravel reefs to the south creates a shallow-water channel separating Charity Island from its smaller neighbor, Little Charity Island. The area between the two islands is a favorite spot for fishing. On the northeast end of the island, a small bay is lined with limestone bedrock, offering good holding ground as a place to anchor during storms. The harbor of refuge is accessible by small boat, though access is controlled by the U.S. Fish and Wildlife Service.
The island also contains an 11 acre (0.04 km²) pond, literally a 'lake within a lake', fed by springs.
Tours of the island (and even dinner cruises) are available. They include the privately-owned, rebuilt Charity Island Lightlightkeeper's house and a passing view of Gravelly Shoal Light. They are available from a ferry company in Au Gres, Michigan on the mainland, south of Tawas.