Sunset Beach was established in 1905 and developed as a result of the 1920 discovery of oil in the Huntington Beach Oil Field. On August 2, 2010, the Huntington Beach city council, in a 5-2 vote, voted to annex Sunset Beach making the community a part of the much larger Huntington Beach. The annexation was to have officially begun in January 2011 but a group of residents filed suit on December 9, 2010, to stop the annexation due to new taxes that would be imposed on them once they become part of Huntington Beach. A hearing for a preliminary injunction was scheduled for January 19, 2011, in Orange County Superior Court.  Huntington Beach officially annexed Sunset Beach in August 2011.