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Newport Harbor was created naturally. In 1825, heavy flooding changed the course of the Santa Ana River. It began emptying into the sea in the area now known as West Newport. Sand carried downcoast by the prevailing currents and by the river during the rainy season, began to build up into the peninsula which now forms the outer perimeter of Newport Harbor. By 1857 the peninsula had spread to half its present length. In 1861 another great flood started the silt deposits that later became islands in Newport Bay.

During the 1920's and 1930's many harbor improvements were made. Involvement by the City of Newport Beach brought about the creation of the west jetty. Matching federal and local funds were used for further improvements. In 1933, local bonds were passed and the Orange County Harbor District was created to implement the harbor project. Work started in December 1934 and opening celebrations were held on May 26, 1936. President Franklin D. Roosevelt initiated the ceremony by pressing a telegraph key on his White House desk and transmitting a radio signal to the Coast Guard Cutter "Hermes" in Newport Bay.

This telegraph key is on exhibit at the Newport Harbor Nautical Museum on board the Pride of Newport located where the Pacific Coast Highway bridge crosses the Back Bay channel.