With the onset of the West Coast gold rushes, the river port of Hokitika rapidly grew to become one of the busiest ports in the colony during the late 1860s (May: 1962, p 337). However the approach to the port was dangerous; by the end of 1865 when the port had been operating for little more than a year, some forty vessels had been wrecked on the coast or on the bar at the mouth of the Hokitika River. As a consequence, a 'hoist beacon' was erected at the river mouth as a safety measure.

In 1875, it was announced in the local Guardian newspaper that the lighthouse originally intended for the Tory Channel in the Marlborough Sounds would be erected on the terrace at Seaview. Land was reserved in 1876, and a new lighthouse constructed in 1879 to the design of 'Marine Engineer to the General Government' John Blackett - known as the 'father of our lighthouse system'. Between 1871 and 1889, Blackett was responsible for the erection of 14 lighthouses throughout the country. The Hokitika light was a 'fifth order dioptric white light' visible at a distance of 16 miles in clear weather. Gas operated via the town supply, it was first shown on 22 September 1879.

By the early twentieth century, use of the port had declined significantly. Shipping ceased completely in 1929. The light ceased operation on 31 October 1924, and the lamp fittings were removed to the Marine Store in Wellington the following year. The tower was to be demolished by the Marine Department, but gained a reprieve when Seaview Hospital expressed a desire to use it as an observation tower for the hospital sports ground. Later, during WWII, the National Reserve used the tower as a coast watching station.

After the war the lighthouse tower was neglected, and began to deteriorate. In 1976 a discourse on the future of the structure was initiated by the hospital management committee at Seaview, who were at that stage responsible for its maintenance. The lighthouse was surveyed and found to be badly decayed. Despite weatherproofing by the Ministry of Works in 1983, the structure was declared unsound by a hospital engineer in 1987. The erection of a replica was considered at this time. A fire further damaged the structure in 1989. However following the completion of a conservation plan by Chris Cochran in 1989, the Regional Committee of the NZHPT applied to the Trust for a grant for full restoration. A sum was granted in 1991, and the Regional Committee accepted the tender of the Westland District Council to restore the lower 1.5 metres of the tower. This took place in late 1992. Thereafter the lighthouse restoration project languished until 1998, when Heritage Hokitika announced plans to move the lighthouse to a site in the town. Although a discussion document was circulated, the decision was made to preserve the lighthouse on its original site. In 2002 Heritage Hokitika carried out a full restoration. The lantern was replaced and a solar powered working light installed as a token reminder of the building's function.