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The history of Howe Sound begins with the Indigenous people, the Squamish and Shishalh, who have roamed this land and traveled on this body of water for thousands of years, and whose village sites and camp sites are spread throughout the area. The land and islands are still used by Squamish and Shishalh for cultural practices. Both the Squamish and Shishalh are a part of the Coast Salish linguistic and cultural groupings.

Spanish explorer José María Narváez observed the sound in 1791 and named it Boca del Carmelo. Captain George Vancouver entered the sound in 1792, and named it after Admiral Earl Howe.

In 1888, copper was discovered in the mountains around Britannia Creek, south of Squamish. Large scale mining began at Britannia Beach in 1905, and by 1929, the largest copper mine in the British Empire was located here, beside the shores of Howe Sound. The mine closed in 1974, but part of its historical legacy has been the large amounts of toxic effluent it has deposited into Howe Sound.

In September 2021, Howe Sound was designated a UNESCO Biosphere Reserve in recognition of its recovery from industrial pollution and to promote sustainable development

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