The Danish equivalent, Lars, was also the church's original name but around 1600 the prefix "øster" (eastern) was added to avoid confusion with nearby Nylars.

To the east of the village, Bækkegård and Rytterbakken have provided evidence of communities living during the Iron Age and the Viking period.

For a period, it had numerous facilities including a hotel, a bank, a post office, two butchers, a baker, a library and various agricultural interests but today there is only one food store.

[6] Stretching some 1,200 metres (3,900 ft) on either side of the main road, the village is principally a residential area with two schools.

The church and Bornholm's Medieval Centre (Middelaldercenter), just north of the village, attract large numbers of tourists each year, especially in the summer months.