Christmas Island did not receive its name because, like some magical fairy tale land it just so happens to be Christmas there all year long.
Nor did it receive its name as some sort of cruel joke to those who might be searching for just such a place.
The name for this small, self-governing island between Indonesia and Australia, was given as a tribute to the fact that it was discovered on Christmas day, 1643 by Captain William Mynors of the East India Ship Company.
It wasn't until forty five years later that the first person was recorded as having set foot on the island, however – William Dampier of the British ship Cygnet, in 1688.
After this, only a few attempts were made to reach the island over the next two centuries.
These attempts most often ended in only moderate success, as the rough topography of the island make the terrain quite difficult to traverse, though these explorers quickly found the island to have very unique flora and fauna, having had no contact with the outside world for so very long, much like the rest of the Australian continent and Oceania.
In 1888 (that's right, exactly two hundred years after it was first set foot upon) Christmas Island finally became somewhat important, for it was this year that the island was annexed by the British Crown, after an exploration of the previous year discovered minerals which were confirmed to be rich in pure phosphate of lime.
The mining of phosphate began in 1890 using workers from several nearby Asiatic countries, and to a certain extent, though not a very great one, life on Christmas Island finally began to thrive.
It is not quite certain why, but for the next fifty or so years, Christmas Island became somewhat of a point of contention in its own little corner of the world. During this period Britain gave control of the mining to the Singapore, which was followed by an invasion by the Japanese in 1942 and then a mutiny by Indian workers, who interned the residents of the island until the end of World War II.
Apparently, all of this was enough to make the British realize that perhaps Christmas Island, despite its happy name, wasn't quite worth all the trouble, and granted control of the island over to the Australian government in 1957, who then paid off the government of Singapore for their share in the Phosphate mining business.
Since taking control over Christmas Island, the Australian government has declared more than two thirds of the island, mostly lush rainforests, to be National Parks. In addition, the government subsidized a $34 million casino in the nineteen nineties, which failed after only a few years of operation, and had planned to subsidize the building of a commercial spaceport, but that doesn't appear likely to ever get off the ground.
The capital “city” of Christmas Island (the island itself is home to only about 1500 people) is the ominously named, “The Settlement.”
One final thing to know about Christmas Island:
Any webpage a fortunate web browser happens to run across ending in .cx originated on Christmas Island. If one would like to own a Christmas Island domain name, one may click here to do so. Have fun.
References:
The Christmas Island Internet Association
The Christmas Island Tourism Association.
The CIA World Factbook: Christmas Island.