Flinders' expedition described some aspects of the island's flora and fauna. Lower land was covered with large bushes, unlike islands previously passed further north. There was very little of the white, velvety grass Striplex or tufted wiry grass previously seen. A small macropod species was described as "numerous" and specimens were shot. There were a few small casuarinas growing on the island but firewood was scarce. The beaches were "frequented" by Australian sea lions, of which several family groups were closely inspected. Some time prior to 1911, sheep, horses, cattle, milk thistles and oats were introduced to Flinders Island, presumably by Mr Willie Schlink and his family. At this time 1,500 acres of the island had been cleared and was producing 1,400 to 2,000 bags of wheat annually. 4,000 sheep were kept and black and whiterabbits ran wild on the island. By the time of the island's sale in 1911, 30,000 wallabies had been killed there.
Flinders Island supports a colony of little penguins which in 2006 was believed to be "probably declining", with a population of less than twenty birds. An account of Flinders Island's wildlife published in 1934 stated that penguins could "be seen waddling soldier-like among the rocks and cave entrances that constitute their homes."
Flinders named the island after Samuel Flinders, the sloop’s second lieutenant and his younger brother on Saturday, 13 February 1802. A sealing camp was in place on the south-east side of the island by the 1820s. The sealers, their Aboriginal wives and children numbered up to twenty people at one stage. A pastoral survey of the site in 1890 identified ten separate structures associated with the sealing community. Archaeological examination of these structures took place in the 1980s. The Flinders Island Whaling and Sealing Site is listed on the South Australian Heritage Register.
A strip of land along the north coast of the island extending west from the island’s most northerly headland, Point Malcolm, has the subject of the subject of a heritage agreement since 29 August 1995. The parcel of land which is identified as No. HA1003 is sized at. Since 2012, the waters adjoining the Flinders Island have been part of a habitat protection zone in the Investigator Marine Park.
