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Port Stanley has a large sheltered harbour operated by Transport Canada.

Attractions include a large sandy beach and the Port Stanley Festival Theatre. The Port Stanley Terminal Rail operates a tourist train between St. Thomas, Ontario and Port Stanley using a portion of the former London & Port Stanley Railway line. That railway used to travel between this town and London, Ontario.

A settlement named Kettle Creek was founded here in 1812 by Lieutenant-Colonel John Bostwick. Around 1824, it was renamed Port Stanley after Edward Smith-Stanley, 14th Earl of Derby, who had visited nearby Port Talbot . Lord Stanley later became Prime Minister of the United Kingdom and the father of Frederick Stanley, 16th Earl of Derby, Governor General of Canada, ice hockey enthusiast and donor of the first Stanley Cup in 1893.