Local citizens and governments donated 703 acres to the Army in 1897, after the Secretary of War chose the site for an artillery battery to defend the south Puget Sound. By 1900, Fort Lawton was marshaling soldiers for the Boxer Rebellion in China, with transport ships departing Seattle for Nome, Alaska, en route to the conflict. In 1909, the 25th Infantry Regiment transferred from the Philippines to Fort Lawton. These Buffalo Soldiers, roughly 900 men with their families, accounted for about a third of Seattle's African American population at the time. Landscape architect John C. Olmsted redesigned the post in 1910, adding officer and enlisted housing that gave the fort the genteel character it retains in its surviving historic buildings.

During World War II, Fort Lawton also served as a prisoner-of-war camp holding more than a thousand German POWs, with some five thousand Italians passing through en route to Hawaii. On the night of August 15, 1944, violence erupted between Italian prisoners and American soldiers. An Italian POW named Guglielmo Olivotto was found murdered. Forty-three African American soldiers were court-martialed; twenty-eight were convicted. They and their families spent decades challenging the convictions. It took until 2007 for the Army to set aside those convictions, and a formal apology ceremony followed on July 26, 2008. Officials presented the relatives of former soldiers and the two remaining survivors with years of back pay. The case remains one of the most painful chapters in the fort's long history, a reminder that injustice could be as present within the gates as the enemy was beyond them.

After the Korean War drew down the fort's operations and the Cold War brought Nike missiles and Air Force radars to its hilltop, the military declared 534 acres surplus in 1971. Native American activists succeeded in securing 40 acres for the Daybreak Star Cultural Center, a lasting presence of indigenous culture on the grounds. The remaining surplus land was transferred to Seattle and dedicated as Discovery Park in 1973. Fort Lawton officially closed on September 14, 2011, with the last Army Reserve unit relocating to Marysville, Washington. A closing ceremony followed in February 2012. Today the Fort Lawton Historic District preserves the old band barracks, guard house, and officers' quarters within Discovery Park, and the Chapel-on-the-Hill holds city landmark status. Where a million soldiers once waited for ships to carry them to war, families now walk through meadows with views of the Olympic Mountains.

Even in its civilian afterlife, Fort Lawton continues to generate debate. In 2019, the Seattle City Council voted to build over 200 units of low-income and homeless housing on part of the former fort's property. Local residents sued to block the development, reprising the tension between community needs and neighborhood resistance that has defined American military base conversions for decades. The fort's former family housing, occupied by Navy and Coast Guard personnel for nearly 40 years, was purchased by a private developer and remodeled into private ownership. The Capehart Housing in the center of the park was demolished in 2010, its footprint absorbed back into Discovery Park. Fort Lawton keeps reinventing itself, as it has for more than a century.