Lady Margaret School has its origins in Whitelands College School, founded in 1842, soon after the College itself. In 1917, Whitelands School was threatened with closure, and it was only by the strenuous efforts of Miss Enid Moberly Bell, the Second Mistress, and the Staff of the School, that a substantial number of the pupils were "rescued" and became Lady Margaret School in September 1917.

The School began life in the oldest of the three houses facing Parson's Green which now form the present school: Belfield House. The School was named after the Lady Margaret Beaufort, mother of Henry VII, founder of St John's and Christ's Colleges, Cambridge, and a benefactress of education. In 1937, the second house, Elm House, was purchased through the generosity of Miss Anne Lupton.

With the passing of the Butler Act in 1944 the Kindergarten and Junior School were phased out and Lady Margaret became a two-form entry grammar school. In April 1951 its relationship to the Church of England was regularised when it became a Voluntary Aided School.

Today Lady Margaret School is a successful, over subscribed, Church of England Comprehensive in the London Borough of Hammersmith and Fulham.

In 2003 the school achieved specialist status in Mathematics and Computing. Having been designated a 'high performing specialist school' following the successful Ofsted inspection, the school was awarded a second specialism in Music in 2008.  In 2009, in a subject-based inspection, the English Department was judged 'outstanding'.

Ofsted, in its most recent full inspection in September 2011, said 'Lady Margaret School provides its students with an outstanding standard of education.'  In November 2011 the Statutory Inspection of Anglican Schools, judged the school to be 'outstanding' in all categories.

The Olivier Centre was opened in September 2010 to accommodate more Sixth Form teaching and study areas, improved Music and ICT facilities and an auditorium.