Lathlain's development commenced in the 1890s when Peet " Co subdivided and sold lots in the "Victoria Park Station Estate" east of the railway station, with quarter-acre blocks on sale for £25-£30. A brochure advertising the state claimed the lots were "So near Perth, near the Station and so near the Trams" (although the tram service never quite eventuated). Residential development was slow, and Gallop records in his historical notes that "bush land with some heavy timber and the occasional stray cow from Belmont greeted the post-war generation who built the suburb.^[3]

The suburb's name honours Sir William Lathlain, the Lord Mayor of Perth from 1918 until 1923. The name was in general use since the 1950s, after a park of this name was built there, but was not gazetted until 1981.^[4]

It was first proposed in 1953 for the Perth Football Club, an Australian rules football team in the West Australian Football League to be based at a new oval to be built on vacant land at Lathlain in November 1953, and the Perth City Council supported the scheme. The ground was built, and as residents started to move into the area and a primary school (1956) was also constructed. On 11 July 1959, the club moved into the premises at the ground, known as Lathlain Park, and went on to win premierships in 1966-1968 and 1976-1977. The ground was renamed to Eftel Oval in 2003.