It honors the restoration of sovereignty to the kingdom, following the occupation of Hawaiʻi by the United Kingdom during the 1843 Paulet Affair, by British Rear-Admiral Richard Darton Thomas and when King Kamehameha III uttered the phrase: Ua Mau ke Ea o ka ʻĀina i ka Pono ('The life of the land is perpetuated in righteousness').

Paulet, without the authorization of his superiors, unilaterally occupied the kingdom in the name of Queen Victoria on February 25 despite the protests of Hawaiian King Kamehameha III and his ministers.

[2][3] After a five-month occupation, Rear-Admiral Richard Darton Thomas, the Commander-in-Chief of the Pacific Station, sailed into Honolulu on his flagship HMS Dublin on July 26, 1843, and requested an interview with the king.

[6][4] The king declared a ten-day holiday and the entire community including foreigners and native Hawaiians rejoiced in festivities with a lavish luau of suckling pig, fish and poi.

[7][8] During the fourth anniversary of the restoration in 1847, King Kamehameha III and his wife Queen Kalama hosted a grand luau at their summer palace, Kaniakapupu, attended by an estimated ten thousand guests.

The Provisional Government of Hawaii, which was established as an interim regime while a treaty of annexation was being pushed through the United States Congress, abolished the holiday.

Private observance of the fiftieth anniversary on July 31, 1893, was watched by the oligarchical government with an air of suspicion, while royalists and supporters of the deposed queen hoped in vain for another restoration to occur.

[28][29][30] In Honolulu, the holiday is marked by the celebration of Hawaiian culture, history and activism through organized speeches, presentations, marches, hula performances, music rallies and flag-raising.