The Manhasset Bay area was likely first inhabited in the 17th century by the Matinecock tribe of Algonquin Indians.
[clarification needed][2] Then the Dutch and the English settled around the bay in the 17th century because of the proximity of fish.
In the 1920s, the bay began to switch from the cow-and-fish industry to support services for commercial boating,[3] as it is considered to be one of the best harbors on Long Island Sound with little tidal current except at the entrance and average tidal displacement of only six feet.
The Sands Point Seaplane Base on Manhasset Bay was at one time the main airport for passenger service between New York and Europe.
At the beginning of the 21st century, it had about 16% of all the marinas and yacht clubs in the whole of Long Island Sound.