Built by 1906 to lodge Rio Grande Railroad Company passengers and tourists, especially fishermen and hunters, the Queen Isabel Inn was first known as "Point Isabel Tarpon & Fishing Club". The hotel hosted family train excursions from Brownsville as early as 1907. Prominent visitors to the inn included president-elect Warren G. Harding in November of 1920. By 1930, indoor plumbing, electrical service, and a popular dining room made the hotel an attractive destination for vacationers.
The Rio Grande Valley Fishing Rodeo was organized here in the summer of 1934 to promote tourism. The hotel was the headquarters for the contest, later renamed the Texas International Fishing Tournament. Hurricanes in 1933 and 1967 removed the hotel's original porches and pitched roof. The hotel has served as the site for many important civic and social events and has been associated with the lives of persons significant to Port Isabel's history. The Queen Isabel Inn sparked the beginning of the hotel and tourism industry in the area and endures as an important landmark business in Port Isabel history.