The first known visitors to Shawnigan Lake hunted and fished near the lake but never settled permanently. Arrowheads and small Native artifacts have been found around the lake providing material evidence of their activity in the area. The East Shawnigan Lake Road, which was part of the Goldstream Trail (built in 1862), is based on a much older Native trading route.  

Late in the 19th century, homesteaders were encouraged by the Government to settle in the Cowichan Valley. Only a few hardy settlers made their way toward Shawnigan Lake. Then, in 1885, a year before the E & N rail line was complete, Charlie Morton built a hotel on the waterfront at Shawnigan Lake.

The E & N rail line was instrumental in the development of the community of Shawnigan Lake. By 1890, a sawmill on the lakeshore, and logging operations around the lake attracted workers from India, China, Japan and other countries. Many of these workers had come to British Columbia to build the railroad and, with that done, turned their efforts to sawmilling and logging. The Shawnigan Lake Lumber Company was an integrated company that owned its timber, and the mill which processed it. The E&N Railway was used to transport the dressed lumber to markets.

By 1900, a second large hotel, Strathcona Lodge, was in operation on the lake. Both of the Shawnigan Lake hotels relied on the railroad to bring hundreds of people, from Victoria, every weekend. The lake became a popular resort destination.

The area also attracted a large group of upper-class British Colonels who had served in India and China, for the British Army. They chose to settle at Shawnigan Lake, on their retirement, rather than returning to Britain. According to the 1901 census, Shawnigan Lake had a permanent population of 265 people at the time.

The sawmill, and the logging activities, played a significant role in the economic development at Shawnigan Lake. Many employees chose to buy property, marry and raise their families in the area. It was a tough blow to the community and the local economy when the sawmill burned down for the third time, in the mid 1940s, and was not replaced.

Private Schools also attracted people to Shawnigan Lake and continue to provide employment. Since 1916, Shawnigan’s many well-respected boarding schools have brought students and educators to the area. The clean air at Shawnigan Lake with its purported health benefits was one reason that parents chose the schools here. Many properties around the lake were also bought based on the same premise. Shawnigan Lake was known as a recuperative place for health issues.

The Malahat Drive portion of the Trans Canada Highway, built in 1911, improved access to Shawnigan Lake. However, the train continued to be the important transportation link until well into the 1930s as most people did not own automobiles.  The Malahat Drive, which was improved in 1958, shortened the driving time to the lake and by then most people had cars. The number of summer homes around the lake increased dramatically in the late 50s and through the 1960s.

Shawnigan Lake has had a small, but permanent, population since the turn of the 20th century and the community has always been strong and vibrant. A 1960s and 1970s residential housing boom made the Cowichan Valley one of Canada’s fastest growing areas, and Shawnigan Lake felt the impact with a large influx of residents. Since that time, many summer homes have been transformed into permanent residences.

Shawnigan Lake’s proximity to urban centres and amenities continues to attract residents seeking a mild climate and semi-rural lifestyle. Now, with a population of just over 8000, and rampant residential development in the area, the community of Shawnigan Lake is poised for yet another major growth spurt.