Archaeological studies of Grand Cayman have found no evidence that humans occupied the islands prior to the sixteenth century.
The first recorded English visitor was Sir Francis Drake in 1586, who reported that the caymanas were edible, but it was the turtles which attracted ships in search of fresh meat for their crews. Overfishing nearly extinguished the turtles from the local waters.
Caymanian folklore explains that the island's first inhabitants were a Welshman named Walters (or Watler) and his companion named Bawden (or Bodden), who first arrived in Cayman in 1658 after serving in Oliver Cromwell's army in Jamaica. The first recorded permanent inhabitant of the Cayman Islands, Isaac Bodden, was born on Grand Cayman around 1700. He was the grandson of the original settler named Bodden.
A variety of people settled on the islands: pirates, refugees from the Spanish Inquisition, shipwrecked sailors, and slaves. The majority of Caymanians are of African and English descent, with considerable interracial mixing.
England took formal control of the Caymans, along with Jamaica, under the Treaty of Madrid in 1670 after the first settlers came from Jamaica in 1661-71 to Little Cayman and Cayman Brac. These first settlements were abandoned after attacks by Spanish privateers, but English privateers often used the Cayman Islands as a base and in the 18th century they became an increasingly popular hideout for pirates, even after the end of legitimate privateering in 1713. Following several unsuccessful attempts, permanent settlement of the islands began in the 1730s. The Cayman Islands historically have been popular as a tax haven. In November 1794, ten vessels, which were part of a convoy escorted by HMS Convert, were wrecked on the reef in Gun Bay, on the East end of Grand Cayman, but with the help of local settlers, there was no loss of life. The incident is now remembered as The Wreck of the Ten Sail. Legend has it that there was a member of the British Royal Family on board and that in gratitude for their bravery, King George III decreed that Caymanians should never be conscripted for war service and Parliament legislated that they should never be taxed. However, no real evidence has been found for this.
From 1670, the Cayman Islands were effective dependencies of Jamaica, although there was considerable self-government. In 1831, a legislative assembly was established by local consent at a meeting of principal inhabitants held at Pedro St. James Castle on December 5 of that year. Elections were held on December 10 and the fledgling legislature passed its first local legislation on December 31, 1831. Subsequently, the Jamaican governor ratified a legislature consisting of eight magistrates appointed by the Governor of Jamaica and 10 (later increased to 27) elected representatives.
In 1835, Governor Sligo arrived in Cayman from Jamaica to declare all slaves free in accordance with the Emancipation Act of 1833.