In the Hawaiian language Kailua means "two seas" or "two currents", a contraction of the words kai (meaning "sea" or "sea water") and ʻelua (meaning "two"); it is so named because of the two lagoons in the district or the two currents which run through Kailua Bay.  During the reign of King Kākuhihewa and his successors, Kailua replaced Waikiki as the residential seat of the Oʻahu Rulers (aliʻi nui of Oʻahu). Many ancient temple ruins, such as those at Ulupo Heiau State Historic Site, are in the area.

Kailua Beach is crescent-shaped, about 2.5 miles (4.0 km) long, and ranging between 50 and 150 feet (15 and 46 m) wide. The ocean bottom fronting the beach slopes gently to overhead depths without any coral heads. Light to medium waves support surfing and bodysurfing. The steady trade winds make Kailua Beach a top windsurfing and kitesurfing destination. Robby Naish, first World Champion of windsurfing and Professional Windsurfers Association Hall of Fame inductee, grew up in Kailua.  Sea kayaking and stand-up paddleboarding to the protected seabird sanctuaries Flat Island and the Nā Mokulua, popularly known as "the Mokes", have become increasingly popular water activities at the beach.