Military use

During late July 1941, a United States Army Air Forces (USAAF) team headed by Captain Elliott Roosevelt investigated the Frobisher Bay region for a potential airport for use in trans-Atlantic air traffic. Roosevelt's report designated a marginal site at Cape Rammelsberg for later construction. In mid-October, trawlers Lark, Polarbjoern, and Selis reached the vicinity, but owing to inaccurate charts (dating from the 1865 expedition of Charles Francis Hall) could not find the Roosevelt site. Instead, an eight-man crew commanded by USAAF Captain John T. Crowell was offloaded on a smaller island "about eight miles southeast of the headland Captain Roosevelt had recommended." They operated a weather/radio station over the winter. The expedition reported that "this island is reported to be some 400 feet high and very level on top providing a natural runway of more than a mile in length." The ships left on 5 November.

When the station relief and base construction expedition arrived next July, both the Crowell and Roosevelt sites were rejected in favour of a level meadow discovered along the Sylvia Grinnell River on mainland Baffin Island. On 30 July, ships Polaris and Effie M. Morrissey anchored in what was then called Koojesse Inlet and began surveying the area: "The terrain was excellent, with level ground extending nearly the entire 6,000 feet needed for an ample runway...The harbor, readily accessible from the bay, offered a good anchorage for ships of any size that would come in." The expedition consisted further of the USCGC Bear, equipped with a seaplane, the transports Fairfax and Eleanor and some smaller vessels. Having offloaded the airport construction crews and materials, the expedition left at the end of September.

World War II

By summer of 1943, the airbase at Koojesse Inlet had "grown to look like a populous village" and was in use by many aircraft. It was designated Crystal II and referred to as Chaplet in coded communications. It was one of three "Crystal" weather sites in the Canadian Arctic Region, Fort Chimo (now Kuujjuaq), Quebec, being "Crystal I", and a station on Padloping Island being "Crystal III". A detachment of the 8th Weather Squadron, Air Transport Command (ATC), took up residence at the station on October 1, 1942. The initial mission of the Crystal sites was to provide long-range weather information to the combat forces then building up in the United Kingdom.

As part of the Crimson East air route network, the airfield at Crystal II was referred to by USAAF Air Transport Command as ATC Station #10. It was intended to be a transport hub between the Eastern Route, which originated at Presque Isle Army Airfield, Maine, and the Central Route, which originated at Romulus Army Airfield (Detroit Metropolitan Airport), Michigan. The original plan, briefed by Captain Roosevelt to USAAF Chief Henry "Hap" Arnold and others at the Atlantic Conference in August 1941, called for Frobisher Bay to be a node in a northern alternate air route, running from Churchill, Manitoba, via Southampton Island over Frobisher to Bluie West Eight and Bluie East Two in Greenland, rejoining the main route in Iceland. The later success of the main air route via Bluie West One and the spring 1943 victory in the Battle of the Atlantic led to cancellation of the Crimson project in late 1943, and the associated airfields were reduced to weather, communications, and logistics duties.

The air base initially had 2 runways, first was 6,000 feet (1,800 m) paved and the second was 5,000 feet (1,500 m) gravel. The shorter of the two was used briefly and decommissioned by 1944 for use as storage. Today the former runway is a commercial area along Akilliq roadway.

The use of Frobisher Bay declined with the end of World War II, with jurisdiction of the facility being transferred to Military Air Transport Service (MATS) in 1948, under its Air Weather Service. During the 1950s it continued to be used as a transit point by the

United States and Canada as RCAF Frobisher Bay Station. The base was closed in 1963 and converted into a civilian airport.

Civilian use

Since the 1950s, Frobisher Bay had earned a reputation as a technical stop for airlines flying the North Atlantic. Crews departing westward from Prestwick or Shannon in those years preferred to route via Iceland (or the Azores) to Gander, thence to New York City or elsewhere. Weather, however, could dictate a northerly course, which is when Frobisher Bay came into its own. In 1959, Pan American even had a base there and on at least two occasions had to change engines on Douglas DC-7Cs at Frobisher Bay.

With the introduction of the intercontinental Boeing 707 and Douglas DC-8, fewer airlines stopped at Iqaluit. The place remained prominent as a regional airport, continued in its strategic role of sustaining the Distant Early Warning Line (DEW), supported the occasional military exercise or scientific expedition, and was a key stopover on the North Atlantic ferry route.

Through the 1960s, Nordair was the main airline serving Frobisher Bay from Montreal, 1,100 nautical miles (2,000 km; 1,300 mi) to the south.