The impetus for the creation of Board of Longitude was a petition presented to Parliament in 1714. The petitioners, William Whiston, the former Lucasian Professor of Mathematics at Cambridge, and Humphrey Ditton, the mathematical master at Christ's Hospital, London, called for be a reward to be offered for 'discovering the longitude'. A Parliamentary Committee, including Sir Isaac Newton and Edmund Halley, was set up to examine the matter, and found in favour of the petitioners' suggestion. Their report was accepted unanimously by the House of Commons, and 'A Bill for Providing a Publick Reward for Such Person or Persons as shall Discover Longitude at Sea' became law on 20 July 1714.

The terms for the payment of the huge reward offered under the new Act were both strict and complex. Payment was to be on a sliding scale according to the accuracy of the results that were achieved. For accuracy to within sixty geographical miles £10,000 was payable, for accuracy to within forty geographical miles the sum rose to £15,000, and the maximum award of £20,000 went to the first person to achieve accuracy to within thirty geographical miles. Half the reward was payable when the Commissioners of the Board of Longitude were satisfied that 'Any such Method extends to the Security of Ships within Eighty Geographical Miles of the Shores which are the Places of Greatest Danger'. The other half was to be withheld until 'a ship by the Appointment of the said Commissioners, or the major part of them, shall thereby actually sail over the ocean, from Great Britain to any such Port in the West-Indies, as those Commissioners, or the major part of them, shall choose or Nominate for the Experiment, without losing their Longitude beyond the limits before mentioned'. Further sums of up to £2,000 were permitted to be awarded to the inventors of promising schemes, in order to provide encouragement and to enable experiments to be carried out.

The administration of the scheme was made the direct responsibility of a new Board of Longitude, which was comprised of the Lord High Admiral of Great Britain; the Speaker of the House of Commons; the First Commissioner of the Navy; the First Commissioner of Trade; the Admirals of the Red White and Blue Squadrons; the Master of Trinity House; the President of the Royal Society; the Astronomer Royal; the Savilian, Lucasian and Plumian Professors of Mathematics at Oxford and Cambridge; and ten named Members of Parliament.

The earliest meeting recorded in the confirmed minutes of the Board of Longitude took place in 1737. At this meeting a decision was reached to award £250 to John Harrison under the terms of the 1714 Act, following the partially successful trial of his first 'Sea-clock', Harrison 1, on a voyage to Lisbon. This clock determined longitude based on principles laid down in 1530 by Gemma Frisius in his 'De Principiis Astronomiae et Cosmographiae'. In its modern form the method relied on two factors. Firstly, an accurate measurement was needed of apparent local time deduced from the altitude of the Sun, corrected by way of the Equation of Time perfected by John Flamsteed, the First Astronomer Royal. Secondly it was necessary to have an equally accurate measurement of time by means of a clock set at a specified meridian from which a precise position could be ascertained.

Harrison's work was encouraged on several occasions by payments from the Board, which allowed him to continue to develop his 'sea clocks', or chronometers, as they came to be known. During 1761-1762, the fourth of these time-keepers, a large watch known as Harrison 4, travelled with John's son William to Jamaica and back aboard HMS 'Deptford'. Although Harrison claimed that H4 had more than complied with the terms of the 1714 Act, the Board disagreed and insisted upon another trial and further conditions. The second trial took place in 1764 on board HMS 'Tartar', during her voyage to Barbados. Careful preparations were made to ensure accuracy, and again H4 seemed to pass the test. However, the Board was still not fully satisfied. Only half the full reward was paid, and this on condition that Harrison disclose all the secrets of the method of construction. Stipulations were also made that copies of H4 should be constructed and tested before any more money was paid. The first copy of Harrison's clock was made by Larcum Kendall and designated K1. It was sent with Captain Cook on his second voyage and proved exceptionally accurate, receiving glowing praise from both Cook and his astronomer, William Wales. Despite this success, Harrison was obliged to appeal to King George III himself before the Board finally agreed, in 1773, to pay the majority of the rest of the reward.

The protracted nature of this dispute and the importance of Harrison's claims virtually eclipsed much of the other work of the Board. In fact, at the same time as the Board was in dispute with Harrison, it was also in the process of examining a lunar method, which was to prove to be the only serious rival to the 'chronometer method'. The alternative method, using lunar distances, was based on the accurate tables produced by the German astronomer Tobias Mayer. Mayer's first tables, derived from the equations of the German mathematician Leonard Euler and the observations of Mayer and James Bradley, were received by the Board in 1755. These were improved by the second set that Mayer bequeathed to the Board on his death in 1762. In their final form the tables proved to be generally accurate to within three nautical miles, which meant that the position of the Moon could be calculated several years in advance. The accuracy was such that the Astronomer Royal, Nevil Maskelyne, was able to use the tables to produce the early editions of the 'Nautical Almanac and Astronomical Ephemeris', the first of which appeared in 1767. The almanac proved to be of vital importance both in navigation and general astronomy, and annual editions are still published today.

The greatly increased accuracy in finding longitude and the awarding of the major prize to John Harrison meant that the Board had lost its initial raison d'etre: the administering of the awards scheme. As a result, a new bill was passed in 1774, which moved the emphasis of the Board's work away from longitude and on to navigation in general. During this new period, the Board continued to involve itself in the development of chronometers. Prominent watch-makers such as Thomas Mudge, John Arnold and Thomas Earnshaw submitted their work to the Board for appraisal and made important innovations in the design and construction of chronometers. However, while it continued to work on chronometers, the Board's fields of interest became much wider under the new Act. More attention was now given to improving other techniques of navigation and related topics. Sextants were refined and improved with new developments such as the artificial horizon and the tangent screw. Greater accuracy was also achieved in the technique of ruling the scale divisions of sextants and quadrants, perhaps most notably by the instrument-maker Jesse Ramsden. Other areas such as the accurate measurement of ships' tonnage were also dealt with, as were subjects such as meteorology, gravity and magnetism, and the production of accurate naval charts.

It was partly to achieve the last of these tasks, partly to test chronometers in the environment for which they were designed and partly to make observations of the southern stars to facilitate better navigation that the Board became involved in voyages of discovery during the late eighteenth and early nineteenth centuries. The most notable of these voyages were the second and third expeditions of Captain James Cook, who visited Australia, New Zealand and the Pacific in 1772-1775 and 1776-1780. Other expeditions of interest include the ill-fated voyage to Australia in 1801 of HMS 'Investigator' under the command of Captain Matthew Flinders, involving, among other mishaps, a shipwreck and a lengthy incarceration by the French in Mauritius; and the exploration of the north-west coast of North America by Captain George Vancouver. The Board employed astronomers on these expeditions, including William Bayly, John Crosley, William Gooch, James Inman and William Wales, who carried out astronomical observations, tested the reliability of chronometers, measured magnetic variations at different points around the globe, made determinations of latitude and longitude and measured the Earth's gravity, normally using a Kater's pendulum.

Another great quest in which the Board was involved was the search for a north-west passage across the top of the American continent between the Atlantic and Pacific Oceans. Rewards, similar to those offered under the 1714 Act, were put up for the discovery of the passage, and lesser amounts offered depending on the most westerly longitude achieved. The only claimant for this award was the expedition of HMS 'Hecla' and HMS 'Griper' commanded by Captain William Parry, which reached a longitude of 113° west in 1820, and which was awarded £5,000. A similar reward was offered for progress towards the North Pole, but no further claims for either reward were made before the Board was disbanded.

The last major project undertaken by the Board was the foundation of the observatory at the Cape of Good Hope in 1822, with the aim of greatly increasing the knowledge of the southern skies and consequently improving navigation south of the Equator.

By the 1820s the role of the Board had become less well defined and more closely linked with the pure astronomy undertaken at the Royal Observatory at Greenwich. In later years the Board's existence became overwhelmed by impractical schemes and interminable attempts to find methods of perpetual motion and the quadrature of the circle. The initial ardour for the great voyages of discovery had also cooled, and difficulties had grown due to the turbulent state of world affairs at that time. As a consequence, the Board of Longitude's significance was greatly diminished, and it was dissolved on 15 July 1828 by 'An Act for repealing the laws now in place relating to the discovery of the Longitude at Sea'. Its remaining responsibilities, such as chronometer rating and overseas astronomical observation, were subsumed into the work of the Royal Observatory. Other areas into which the Board might have moved were taken over by the newly-formed Royal Geographical Society and Royal Astronomical Society.