Gatwick was a manor in the parish of Charlwood, a village in Surrey. In 1891, a racecourse was built on the land to replace one in nearby Croydon, and the London, Brighton & South Coast Railway provided a railway station to serve it. Growth in the popularity of aviation in the 1920s resulted in London's first airport being established at Croydon. Soon afterwards, land next to Gatwick racecourse was developed as an airfield as well. It received an aerodrome licence in 1930, and was called Gatwick Aerodrome because of its proximity to the racecourse.

A. M. (Morris) Jackaman, who owned several light aircraft, bought the aerodrome in September 1933. He had bold ideas for its future, such as expanding it to make it suitable to use as a relief aerodrome for London (Croydon) Airport and providing a regular service to Paris using de Havilland DH.84 Dragon aircraft. Overcoming resistance from the Air Ministry, which was concerned about the cost of draining the clayey land and diverting the River Mole, he oversaw Gatwick's transition to a public aerodrome. It was licensed for non-private flights in 1934.

He planned a proper terminal building linked to a new railway station on the adjacent Brighton Main Line, and replacing a former farmhouse which had been converted into a clubhouse and terminal. He developed the idea of a circular terminal building and submitted a patent application for the concept on 8 October 1934. Advantages claimed for the design included efficient use of space and greater safety of aircraft movements. Telescopic "piers" or gangways would provide covered access from the building to the aircraft. A subway was recommended as the best method of bringing passengers into the building from outside.

Jackaman raised money by floating his company, Airports Ltd, on the stock exchange. The Air Ministry also paid for the right to use Gatwick as a diversionary destination at times when Croydon Aerodrome was inaccessible. In 1935, Hillman's Airways made Gatwick its operational base, increasing its commercial viability and providing more finance. The aerodrome closed on 6 July 1935 to allow the new terminal to be built.

The terminal was designed by architects Hoar, Marlow and Lovett in accordance with the design provided by Morris Jackaman. It was built from steel-framed reinforced concrete with brick layers inside, and has been described as a good example of the 1930s trend whereby concrete was used instead of steel.

As originally built, the interior consisted of concentric rings of rooms and offices with corridors between them, designed to keep arriving and departing passengers separate. Six telescopic covered corridors led from the main concourse, allowing six aircraft to be in use at one time. A subway led from the terminal to the new station, 130 yards (119 m) away, ensuring that passengers arriving by train from London stayed undercover from the time they arrived at Victoria station until the time their aircraft reached its destination.

The building rises from one storey in the exterior ring to three in the centre. This central section originally contained a control tower, weather station and some passenger facilities; the main passenger circulating area surrounded it on the storey below. Baggage handling also took place on this floor. A restaurant and offices were on the ground floor in the outermost ring. The ground and first floors have windows of various sizes at regular intervals, while the former control tower was glazed all around.

The design is frequently described as innovative and revolutionary, and The Beehive is recognised as having been the world's first integrated airport building, combining all necessary functions in a single structure. It was the first airport to give direct, undercover access to the aircraft, and the first to be integrated with a railway station.

It was completed in early 1936. Although the airport was officially reopened on 6 June 1936, flights to various destinations began in May. Jackaman's proposed service to Paris was included: three flights were operated each day, connecting with fast trains from London Victoria station. Combined rail and air tickets were offered for £4.5s, and there was a very short transfer time at the terminal; on some flights it was as little as 20 minutes.

Gatwick Airport, as it had become, was requisitioned for military use during  World War II. Afterwards, in 1952, it was agreed upon as the site of London's official second airport. A large new terminal was built between 1956 and 1958, the 1935 railway station was closed and a new station was built within the terminal complex, on the site of the old Racecourse Station. The Beehive was thus cut off from transport connections and the airport at large, although it was still within the boundary and was used for helicopter traffic for several more years.

Changes have been made to the internal layout since the conversion of the building to offices, although many period fittings remain. The Beehive is a Grade II* Listed Building.