A 1523 map of the islands referred to them as Lagartos, meaning alligators or large lizards, but by 1530 they were known as the Caymanes after the Carib word for the marine crocodile which also lived there.
The first recorded English visitor was Sir Francis Drake in 1586, who reported that the caymanas were edible, but it was the turtles which attracted ships in search of fresh meat for their crews. Overfishing nearly extinguished the turtles from the local waters.
The first recorded permanent inhabitant of the Cayman Islands, Isaac Bodden, was born on Grand Cayman around 1700. He was the grandson of the original settler named Bodden who was likely one of Oliver Cromwell's soldiers at the taking of Jamaica in 1655.
A variety of people settled on the islands: pirates, refugees from the Spanish Inquisition, shipwrecked sailors, and slaves. The majority of Caymanians are of African and British descent, with considerable interracial mixing.
Britain took formal control of the Caymans, along with Jamaica, under the Treaty of Madrid in 1670 after the first settlers came from Jamaica in 1661-71 to Little Cayman and Cayman Brac. These first settlements were abandoned after attacks by Spanish privateers, but British privateers often used the Cayman Islands as a base and in the 18th century they became an increasingly popular hideout for pirates, even after the end of legitimate privateering in 1713. Following several unsuccessful attempts, permanent settlement of the islands began in the 1730s. The Cayman Islands historically have been popular as a tax haven. In November 1794, ten vessels, which were part of a convoy escorted by HMS Convert, were wrecked on the reef in Gun Bay, on the East end of Grand Cayman, but with the help of local settlers, there was no loss of life. The incident is now remembered as The Wreck of the Ten Sail. Legend has it that there was a member of the Royal Family onboard and that in gratitude for their bravery, King George III decreed that Caymanians should never be conscripted for war service and Parliament legislated that they should never be taxed. However, no real evidence has been found for this.
From 1670, the Cayman Islands were effective dependencies of Jamaica, although there was considerable self-government. In 1831, a legislative assembly was established by local consent at a meeting of principal inhabitants held at Pedro Castle on December 5. Elections were held on December 10 and the fledgling legislature passed its first local legislation on December 31 1831. Subsequently The Governor of Jamaica ratified a legislature consisting of eight magistrates appointed by the Governor of Jamaica and 10 (later increased to 27) elected representatives.
In 1835, Governor Sligo arrived in Cayman from Jamaica to declare all slaves free in accordance with the Emancipation Act of 1833.
The Cayman Islands were officially declared and administered as a dependency of Jamaica from 1863, but were rather like a parish of Jamaica with the nominated justices of the peace and elected vestrymen in their Legislature. From 1750 to 1898 the Chief Magistrate was the administrating official for the dependency, appointed by the Jamaican governor. In 1898 the Governor of Jamaica began appointing a Commissioner for the Islands. The first Commissioner was Frederick Sanguinetti. In 1959, upon the formation of the Federation of the West Indies the dependency status with regards to Jamaica ceased officially although the Governor of Jamaica remained the Governor of the Cayman Islands and had reserve powers over the Islands. Starting in 1959 the chief official overseeing the day to day affairs of the islands (for the Governor) was the Administrator. Upon Jamaica's independence in 1962, the Cayman Islands broke its administrative links with Jamaica and opted to become a direct dependency of the British Crown, with the chief official of the islands being the Administrator.
In 1953 the first airfield in the Cayman Islands was opened as well as the George Town Public hospital. Barclays ushered in the age of formalised commerce by opening the first commercial bank.
Following a two year campaign by women to change their circumstances, in 1959 Cayman received its first written constitution which, for the first time, allowed women to vote. Cayman ceased to be a dependency of Jamaica.
During 1966, legislation was passed to enable and encourage the banking industry in Cayman.
In 1971 the governmental structure of the Islands was again changed with a Governor now running the Cayman Islands. Athel Long CMG, CBE was the last Administrator and the first Governor of the Cayman Islands.
In 1991 a review of the 1972 constitution recommended several constitutional changes to be debated by the Legislative Assembly. The post of Chief Secretary was reinstated in 1992 after having been abolished in 1986. The establishment of the post of Chief Minister was also proposed. However, in November 1992 elections were held for an enlarged Legislative Assembly and the Government was soundly defeated, casting doubt on constitutional reform. The "National Team" of government critics won 12 (later reduced to 11) of the 15 seats, and independents won the other three, after a campaign opposing the appointment of Chief Minister and advocating spending cuts. The unofficial leader of the team, Thomas Jefferson, had been the appointed Financial Secretary until March 1992, when he resigned over public spending disputes to fight the election. After the elections, Mr. Jefferson was appointed Minister and leader of government business; he also held the portfolios of Tourism, Aviation and Commerce in the Executive Council. Three teams with a total of 44 candidates contested the general election held on November 20, 1996: the governing National Team, Team Cayman and the Democratic Alliance Group. The National Team were returned to office but with a reduced majority, winning 9 seats. The Democratic Alliance won 2 seats in George Town, Team Cayman won one in Bodden Town and independents won seats in George Town, Cayman Brac and Little Cayman.
Although all administrative links with Jamaica were broken in 1962, the Cayman Islands and Jamaica continue to share many links and experiences, including membership in the Commonwealth of Nations (and Commonwealth citizenship) and a common united church (the United Church in Jamaica and the Cayman Islands) and Anglican diocese (although there is debate about this) as well as a common currency (until 1972). Also, by 1999, 38-40% of the population of the Cayman Islands was of Jamaican origin and in 2004/2005 little over 50% of the expatriates working in the Cayman Islands (i.e. 8,000) were Jamaicans (with the next largest expatriate communities coming from the United States, United Kingdom and Canada).
In September 2004, The Cayman Islands were hit by Hurricane Ivan, causing mass devastation, loss of human and animal life (both wild and domestic/livestock) and flooding, with some accounts reporting that 25% or more of Grand Cayman had been underwater and with the lower floors of buildings being completely flooded. This natural disaster also led to the bankruptcy of a heavily invested insurance company called Doyle. The company had re-leased estimates covering 20% damage to be re-insured at minimal fees when in fact the damage was over 65% and every claim was in the millions. The company simply could not keep paying out and the adjusters could not help lower the payments due to the high building code the Islands adhere to.
Much suspense was built around the devastation that Hurricane Ivan had caused as the leader of Government business Mr. Mckeeva Bush decided to close the Islands to any and all reporters. This led to severe reports in the media of hundreds dead, when in fact none but two that refused to stay in the shelters were lost. It was also a collective decision within the government at that time to turn away two British warships that had arrived the day after the storm with supplies. This decision was met by outrage from the Islanders who thought that it should have been their decision to make. However, when the Island re-opened in early December to tourists the cruise ships once more started to pour in, all intrigued to see the damage.
While there were visible signs of damage, in the vegetation and an apparent lack of construction in some places, the Island was bustling again as some things had been freshly re-built and those that were not were quite on their way. There remain housing issues for many of the residents as of late 2005.