Port Fairy was named after a small boat 'Fairy', captained by James Wishart, which entered the port and probably the River Moyne during a whaling reconnaissance.At its peak in the 1850s, the port was the second busiest in Australia. Wool, wheat and gold were loaded onto great sailing ships bound for England. The ships anchored in the bay while goods and passengers were ferried back and forth from the wharf on smaller craft, known as lighters.