Owned by the State Government, through the Agricultural Department this Butter Factory was opened in 1918. In 1926 South West Dairy Produce Co-operative became the owners and the name changed to Sunny West. Development of the Group Settlement Scheme in the area caused a great upsurge in production, as there were 735 farms in the Busselton district by 1926. Then came the Great Depression of the early 1930’s, the 1939-45 war and the boom period which followed. This boom saw the factory reach peak production of about 30 tons of butter per week. Before the days of refrigeration the factory also operated an Ice Works, supplying the town of Busselton and local fishermen with much sought after ice.
High overheads during the off season coupled with more efficient road transport caused closure of this and several other factories. Operations were then centralised at Boyanup.
Busselton ceased making butter in 1952. A dried milk plant was installed, but a slump in overseas markets made the process unprofitable and production stopped. The premises served as a depot for trucks and tankers until operations ceased altogether in 1973.
The building was vested in the Shire of Busselton which then leased part of it to the Busselton Historical Society.
The Museum opened in 1975 and is now run entirely by volunteers. Tuesdays are set aside for this willing band of workers who collect Busselton memorabilia, maintain the artefacts and build new displays.