Ruins on the island reveal early settlement by Illyrians, Romans and then early Christians, but the island wasn't documented until the mid-10th century. It later became the property of the monasteries of Zadar. Settlement expanded with the 16th-century Turkish invasions, which prompted immigration from elsewhere along the coast.

Dugi Otok’s fortunes have largely been linked with Zadar as it changed hands between Venetians, Austrians and the French, but when Northern Dalmatia was handed over to Mussolini the island stayed within Croatia. Old-timers still recall the hardships they endured when the nearest medical and administrative centre was Šibenik, a long, hard boat ride along the coast.

Economic development has always been hampered by the lack of any freshwater supply – drinking water must be collected from rainwater or brought over by boat from Zadar. The population has drifted away over the last few decades, leaving only the hardiest souls to brave the dry summers and bura-chilled winters.