As a landing point for Christchurch-bound seafarers, Lyttelton has historically been regarded as the "Gateway to Canterbury" for colonial settlers.

The town is situated on the lower slopes of the Port Hills, which form the northern side of the harbour and effectively separate Lyttelton from the city of Christchurch.

[8] A tunnel through the Port Hills provides direct road access to Christchurch, 12 km to the northwest.

The town of Sumner, some 6 km to the northeast, is accessed via Evans Pass, this link was closed after the 2011 Christchurch earthquake and reopened on 29 March 2019.

[12][better source needed] Joseph Thomas, as the agent of the Canterbury Association and its chief surveyor, was in charge of preparing the settlement for the settlers.

He initially placed the port town at Rāpaki and the settlement's capital, Christchurch, at the head of the harbour at present-day Teddington.

[13][14] But none of these initial ideas proved feasible, as Rāpaki was not available, as it had been promised to Māori as a reserve, and required reclamation at the head of the harbour for the capital was estimated as too expensive.

[15] Early survey work in Lyttelton was done by Thomas and Charles Torlesse, but most of it until completion in September 1849 was done by Edward Jollie.

The present location of the rock is well inland from the sea, as much of Lyttelton's dockside has been reclaimed from the harbour waters in recent years.

four ships (the Randolph, Cressy, Sir George Seymour, and Charlotte Jane) arrived in Lyttelton Harbour, carrying the first what was to be known as the 'Canterbury pilgrims'.

Terra Nova expedition member Apsley Cherry-Garrard makes mention of Lyttelton's importance to Antarctic explorers in his book, The Worst Journey in the World: And so it was with some anticipation that on Monday morning, October 24 (presumably 1910), we could smell the land — New Zealand, that home of so many Antarctic expeditions, where we knew that we should be welcomed.

On 24 October 1870, a fire broke out in the Queen's Hotel on London Street and had soon engulfed the main centre of Lyttelton.

[24][25][26] The Lyttelton Timeball Station was erected in 1876 and started signalling Greenwich Mean Time to ships in the harbour that year.

The overall quake damage was less significant than in Christchurch itself, due to the dampening effects of the solid rock that the town rests on and its moderate distance from the epicentre.

[30][31] Some walls of the Timeball Station collapsed and there was extensive damage to residential and commercial property, leading to the demolition of a number of high-profile heritage buildings such as the Harbour Light Theatre and the Empire Hotel.

[33] Bruce Chapman, chief executive of the New Zealand Historic Places Trust (NZHPT) said there was a possibility that it may be reconstructed.

"[33] However, on Monday 13 June 2011 a further 6.3 ML aftershock brought down the tower and remaining walls while workmen were preparing to dismantle it.

The wooden St Saviour's Chapel had been relocated from West Lyttelton to Christchurch's Cathedral Grammar School in the 1970s.

[38] On 19 November 2005, it was announced that 60% of the Banks Peninsula District ratepayers voted to amalgamate with the neighbouring Christchurch City Council, which took place on 6 March 2006.

[49] Melanie Dixon's[50] young adult science fiction novel New Dawning is set in a future Lyttelton affected by climate change.