In reference to the history of the area, two pioneers from New York, James Lauderdale and James Stewart, left their homes in Washington County in 1841 and traveled to Milwaukee to inspect land for sale by the government. They headed south by foot and purchased land in what is now Walworth County. They both purchased 160 acres of land adjacent to the lakes at the price of $1.25 per acre. Records show that fishing and hunting must have been as ample at that time as it is today. Both the Lauderdale and Stewart families were hosts to members of the Sacs and Fox Indian Tribes on their hunting and fishing expeditions. There were few families and the fishing and hunting industries slowly drew more people to the area. Having none of the conveniences now enjoyed at the lakes, a trip to the lakes in those days really meant "roughing it."

During the late 1890’s and the early 1900’s, the Lauderdale Lakes were rediscovered. The men of neighboring cities of Milwaukee, Chicago, Elkhorn and Whitewater were eager to become pioneer summer homeowners. Besides the Lauderdale and Stewart families, there was Hiram Cross and Bigelow, both cattle raisers. Bigelow owned and ran a small sawmill at the entrance of Honey Creek, near the present site of The Sterlingworth Store, an endearing hotel built in 1893 on the east shore of Mill Lake. At one time, two members of the Lauderdale family purchased this business. After a great deal of bargaining and negotiating with the government, a post office was placed in James Lauderdale's newly established trading center, later called "Lauderdale." It was at this point that the group of three lakes became known as the "Lauderdale Lakes".

The Sterlingworth became an extremely popular and well-known resort by the turn of that century, when cottage owners would flock by "boat-taxi" for dinner and dancing. The resort had its own store and bait shop and during the course of its history, changed hands and expanded several times and even survived several fires. It even prospered through Prohibition, keeping a special, discreet room where the guests could sneak a forbidden drink. Some gambled there, too, at private slot machines. The hotel finally closed its doors about a century after they opened. In the late 1980’s, the property was remodeled and converted to condominiums.

With about 1,000 homes now on the lake, the residents continue to enjoy the natural beauty that attracted the earlier settlers to the Lauderdale Lakes.