The creation of the Casco Bay Islands Alliance was a product of post World War II optimism and the need to address projects long deferred by the Great Depression. Casco Bay Development Association (the original name) was first organized on Peaks Island in 1959 to address island beautification and development, social welfare, and collective representation of island interests. The organization soon expanded to include representatives from Peaks Island, Long Island, Cliff Island, Cushing Island, Chebeague Island, and Little and Great Diamond Islands.
Early efforts included island cleanup, eradication of deteriorated housing, promotion of island development, and improvement of ferry piers and services. Other notable projects included the development of Fort McKinley at Diamond Cove, participation in various coalitions to preserve the Portland working waterfront and the water quality of Casco Bay and the regular publication and distribution of a Casco Bay newsletter.
At present, CBIA is focused on enhancing and protecting the quality of life on all the Casco Bay Islands. A way of achieving that goal is by awarding small annual grants allow islands to empower and enhance island
life and culture.