A natural harbour, the port was settled on 24 May 1852 by Alexander Elder and John Grainger. The port was named after Augusta Sophia, Lady Young, the wife of the Governor of South Australia, Sir Henry Edward Fox Young.
It is in the state electorate of Stuart, and the federal Division of Grey.
Port Augusta has been able to capitalise on the growing eco-tourism industry due its proximity to the Flinders Ranges. The Pichi Richi Railway is a major drawcard, connecting Port Augusta to the town of Quorn through Pichi Richi Pass.
Within Port Augusta is the City of Port Augusta’s Wadlata Outback Centre, providing tourists with an introduction to life in the Australian outback. The centre recorded over 500,000 visitors in 2006. North of town, on the Stuart Highway, are the Australian Arid Lands Botanic Gardens. The gardens have a cafe/restaurant with views across the saltbush plains to the escarpment of the Flinders Ranges. The PACC annula report shows more than 100,000 people visited the gardens in 2006.
South-west of town, on the El-Alamein army base, is the Baxter Immigration Detention Centre.