According to Don Tyler in Hit Songs 1900-1955: American Popular Music of the Pre-Rock Era, James Kennedy wrote the words to this song after watching a sunset with his artist sister in Donegal, Ireland.

The music was composed by Will Grosz (who was better known as Hugh Williams).

"Red Sails In The Sunset" was a big hit in the USA in 1935, topping Your Hit Parade for four weeks and selling more than a million copies of the sheet music; many recordings were made, including by Louis Armstrong and Paul Anka, but most notably by Bing Crosby.

The boat which inspired the song was called Kitty Of Coleraine (poetically the boat is itself named after a song), and it actually had white sails, it was only the sunset that made them appear red.

A ten foot tall fishing boat was sculpted and a plaque erected in honor of the song, and the original boat was restored and put on public display in Portstewart Harbour.