The island became isolated from the mainland after the Coode Canal was dug to shorten the length of the Yarra River in 1886.

[2][3] A shipping canal was constructed to the south of the existing course of the river through Fishermans Bend, to allow access from the Port of Melbourne to Yarraville.

In 1927 the Larkin Aircraft Supply Company had set up operations on the island, including a factory and aerodrome,[5][6] which was used until World War II.

[7][8] About 8.5 million litres of organic compounds burned including acrylonitrile and benzene, creating a toxic cloud over nearby residential suburbs, which was dispersed by strong winds.

[13] Proposals were made to move the facility to Point Lillias near Geelong,[14][15] but environmental and Aboriginal heritage concerns thwarted the plans.