The name travelled a long, strange road to this beach. Before 1842 the spot went by Green Knoll, or Punt Town, or the Village of Fareham. Then Charles La Trobe, superintendent of the Port Phillip District, named it after a schooner, the Lady of St Kilda, which lay moored off the main beach through the early months of 1842. The ship in turn carried the name of the St Kilda archipelago off Scotland's western edge, the last truly remote outpost of the British Isles. And that island had borne witness to a quiet cruelty: it was where Lady Grange was imprisoned by her own husband from 1734 to 1740, marooned to keep her from exposing his politics. A grinning seaside suburb thus owes its name to a kidnapped woman on a windswept Scottish rock.

When gold transformed Melbourne in the 1850s, the newly wealthy went looking for sea breezes, and they found them on the high ground above St Kilda Beach. By the 1880s the suburb glittered with mansions and grand terraces; palatial hotels rose to meet them, the Esplanade Hotel in 1878 looking out over the water. The railway arrived in 1857, then cable trams, and the beach became reachable for everyone. But the land boom ended in the bank crashes of the 1890s, ruining many of the newly rich, and the mansions began their slow descent into boarding houses. The wealthy retreated to Toorak and Brighton, and St Kilda set off on its long second act as something more democratic and more dangerous.

In the early twentieth century St Kilda became Melbourne's pleasure beach, what Coney Island was to New York. The Italian-born engineer Carlo Catani redesigned the foreshore into promenades, gardens, and palm-lined avenues, and the amusements came thick and fast: the St Kilda Sea Baths, Luna Park with its Moonface gate in 1912, the Palais de Danse, and in 1927 the Palais Theatre, still standing as one of the grandest cinemas of its era. Servicemen flocked here during two world wars, and with the crowds came a racy reputation that hardened, through the Depression, into something rougher. By the 1960s the streets around Fitzroy Street were known for sex work and strip clubs, and the same cheap apartments that drew the bohemians also drew the city's social troubles.

From at least the 1950s St Kilda was the heart of Melbourne's Jewish community, swelled by refugees who found the small flats familiar and affordable; Cafe Scheherazade on Acland Street served eastern European borscht and latkes for decades. The cheap rooms and late-night venues also made the suburb an artists' colony. In the late 1970s it became a hotbed of dark, noisy post-punk: the Birthday Party, with Nick Cave and Rowland S. Howard, played the legendary Crystal Ballroom at the George Hotel, alongside Hunters and Collectors and Paul Kelly, whose song From St Kilda to Kings Cross swapped all of Sydney Harbour for one sweet promenade. Acland Street's cake shops still draw queues; the music still spills from the Espy's stages.

The breakwater that shelters the little harbour was built for the 1956 Melbourne Olympics, to give the sailing events calm water. Almost at once, something unexpected moved in. A colony of little penguins, the smallest penguin species in the world and standing barely thirty centimetres tall, took up residence among the boulders, and they have nested there ever since. Today the colony numbers around 1,400 birds. At dusk they waddle ashore from a day's fishing in Port Phillip Bay, and visitors line the pier in the half-dark to watch, kept back by rangers and red-filtered torches that spare the birds' eyes. It is one of the city's most beloved sights: wild seabirds raising their young in the heart of a metropolis of five million people.