Premier Annastacia Palaszczuk on Wednesday joined the Butchulla Aboriginal Corporation on the world's largest sand island, formerly known as Fraser Island.
K'gari, the white spirit who was sent down from the sky to help make the land and the seas, was officially welcomed home by generations of Butchulla people and guests.
"It was through disrespect to the Butchulla people that her name, K'gari – the home of the Butchulla people - was taken away," the corporation's chair Gayle Minniecon said.
"Thankfully, it is now through respect to the Butchulla people that K'gari, her name, has been reclaimed.
"Our oral history, our creation story, will now be told and learnt as it should be."
In 1836, after the ship her husband captained was wrecked on the reef, Eliza Fraser and several sailors landed by leaking lifeboat on the island.
Butchulla people fed the shipwrecked visitors and attempted to integrate them into the community, assigning them food preparation and other tasks and trying to treat their sunburn.
Captain Fraser did not survive and is variously described as dying from disease, malnutrition or wounds from being speared.
Some of the other sailors made it to the colony and sent a rescue party for Mrs Fraser.
When Mrs Fraser arrived in the colony, she told authorities that she'd been tortured and kept as a slave, writing an account - debunked by other survivors - that depicted Aboriginal people as barbaric, cannibalistic savages.
Over the following decades, the colony massacred Butchulla people, rounded up survivors and forced them onto missions.
Mrs Fraser parlayed her misadventures into a lucrative speaking career, embellishing and changing her story multiple times after she remarried and returned to the United Kingdom.
Ms Palaszczuk said as Queensland moved towards treaty with Aboriginal and Torres Strait Islander peoples, the government would continue to recognise Indigenous languages through place names, in the spirit of truth-telling and reconciliation.
"While steps like this can't change the wrongs of the past, it goes a long way to building a future where all Queenslanders value, trust, and respect each other," she said.
"This always was and always will be Butchulla Country."
In 2017, the Fraser Island section of the Great Sandy National Park was renamed K'gari (Fraser Island) and in 2022, the island's World Heritage Area was renamed K'gari (Fraser Island) World Heritage Area.
To coincide with the restoration of K'gari, more than 19 hectares of land was transferred to the Butchulla Aboriginal Corporation.
Butchulla land and sea ranger co-ordinator Chantel Van Wamelen said the official recognition honoured the elders who had fought for the change.
"Part of the process is truth-telling and for people to recognise that it's always been named K'gari," she said.
"It is insulting to us to have our island named after a woman who did tell lies about our people, which led to a lot of our people being removed from the island and massacres.
"We've got such a unique ecosystem over here and there's such rich cultural and environmental values on this island.
"It's very special for us to call this place home."
Resources Minister Scott Stewart said the official name change recognised the traditional owners.
"She has always been K'gari to the Butchulla people," he said.
"Now this beautiful area will carry its true name in all aspects, the National Park, World Heritage Area and the official place name."
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