The island was predominantly rural and agricultural in character for much of its history. In the 1920s the first bridge connected downtown Beaufort with Lady's Island. As development of Beaufort and surrounding areas began in the last half of the 20th Century, the island began to develop former plantation and timber tracts into residential subdivisions. A second bridge connected Lady's Island with Port Royal in the 1980s.
The island is home to four public schools (two elementary, one middle, and one high school), Beaufort Academy, a K-12 private school, and Saint Peter's Catholic School, a K3-8 private Catholic school. Commercial development clustered at the intersection of S.C. Highway 802 and U.S. Highway 21 serves Lady's Island, Beaufort, and the surrounding Sea Islands of northern Beaufort County. The island is also the location of the Beaufort County Airport.