Built in 1836 on the northernmost islet of the small chain of Islands located off Harbour Grace, the Harbour Grace Islands lighthouse was only the third to be built in the entire province, after Fort Amherst and Cape Spear. It shared many similarities in design to Cape Spear, namely the square base which also served as the dwelling, topped by the lantern room. The first keeper for the light was Robert Oke, who would later go on to become the inspector of lighthouses in Newfoundland. The original lighting apparatus was eventually replaced with the one that was formerly at Cape Pine lighthouse, before being transferred to the Cape Bonavista lighthouse where it can still be seen today.

In the 1870s, it was noted that a series of rock slips on the island was making it ever more dangerous for the keepers, as the distance between the lighthouse and the cliff eventually narrowed to less than 20 feet. In 1923, a new, smaller tower was constructed to replace the original structure. The original lighthouse was left abandoned before being demolished sometime in the 20th century, along with the 1923 lighthouse which was replaced by an automated, modern, skeletal tower that acts as the navigational aid for the islands today.