Apollo Bay is part of the Gadubanud (Katabanut) people's traditional lands. The people were known to the Europeans as the King Parrot People.
In 1800, the Cape (now known as Cape Otway) was mapped as part of the Victorian coast survey by Lieutenant James Grant sailing in the Lady Nelson.
Some years later whalers and sealers started working in the area. The Henty Brothers set up a whaling station in the 1840s on Point Bunbury
which is located at the west end of the bay. This is where the Apollo Bay golf course is now located.
In 1845 Captain Loutit of the vessel Apollo took shelter in the bay from a storm and named the bay after his ship.
In the 1850s timber cutters settled in the area and established sawmills.
Farmers and graziers made selections in the area subsequently and a small township on Apollo Bay named Middleton slowly grew.
The Middleton Post Office opened on 1st May 1873. Initially, The mail delivery service was fortnightly.
By 1887 the town was renamed Krambruk and the first school was opened in 1880.
In 1898 the town was renamed to its current name of Apollo Bay.
Throughout this period most access to the region was via the sea.
In 1927 the road into the town was upgraded and when the Great Ocean Road was completed in 1932 Apollo Bay became a popular tourist destination
and the importance of fishing was very much enhanced from the much easier access to the Melbourne markets.
On the 10th July 1932, the S.S. Casino, a coastal steamer, sank whilst trying to berth at the town's wharf. The captain and nine crew were lost in the disaster.
Many earlier shipwrecks had occurred in the treacherous waters along the coastline of Cape Otway.
A submarine telegraph and telephone cable was laid from Apollo Bay to Stanley in Tasmania via King Island at a cost of £300,000.
The contract was awarded to Siemans Brothers and Standard Telephones and Cables Ltd (STC) of the UK.
The sub-marine cable service was officially opened on the 25th March 1936 by the Prime Minister, Joseph Lyons.
A telegraph station was established at Apollo Bay
thus providing the first direct communications connection to Tasmania from the mainland.
With the progress in development of telecommunications between the mainland and Tasmania the Apollo Bay Telegraph station became redundant and
was closed in 1963. The old telegraph station is now used as a museum.