Located along the coast of the Indian Ocean, it was named after the English beach resort Scarborough, North Yorkshire.

Since 1999, the local council has deployed a strategy for issues including traffic, parking, zoning, coastal landscape and recreation.

[5]: p176  Perth businessman Alan Bond, who built Observation City, had ambitious plans to convert the entire Scarborough Beach "strip".

After securing most of the real estate, his plans failed to proceed because he was unable to purchase the family-owned fast food restaurant Peter's by the Sea.

The restaurant still exists today after it refused to sell despite Bond making inflated offers on the property, and it has taken on historical significance with the locals ever since.