Marsa Alam was a small fishing and mining settlement until an international airport opened in the early 2000s, which is when tourism began in earnest.
Wadi el-Gemal National Park, south of the town, protects a large area of coast, islands and desert, including Ababda Bedouin lands and Roman-era emerald mines at Sikait.
The coast south of here carried serious traffic long before tourism. Berenice, an ancient harbour further down the coast, was one of Egypt's main Red Sea ports under the Ptolemies and Romans — cargo from India and Arabia landed there and crossed the desert to the Nile by caravan, through the same wadis the dive lodges now sit beside.
The name itself is plain Arabic: a marsa is an anchorage or bay, and this coast is a long series of them — which is exactly why the modern hotels each sit on their own cove with their own reef.
Development here has been deliberately more limited than further north, partly through protected-area designation.