In 1927, the legislature of the Territory of Hawaii passed a resolution calling on the U.S. government to produce a commemorative coin for the 150th anniversary of Cook's arrival in Hawaii. Treasury Secretary Andrew Mellon thought the occasion important enough that, unusually for him, he did not oppose such an issue. The bill for the Hawaii half dollar passed through Congress without opposition or amendment, and became the Act of March 7, 1928 with the signature of President Calvin Coolidge.
Sculptor Chester Beach made the plaster models for the coins from sketches by Juliette May Fraser. Beach had some trouble gaining approval for his designs, as there were issues raised by the Mint and by Victor Stewart Kaleoaloha Houston, Hawaii Territory's delegate to Congress. These concerns were eventually addressed, and the coin went into production. Although the issue price, at $2, was the highest for a commemorative half dollar to that point, the coins sold out quickly and have risen in value to over a thousand dollars.
The Hawaii Sesquicentennial half dollar was proposed because of the observances there for the 150th anniversary of Captain James Cook becoming the first European to reach the Hawaiian Islands, or, as it was termed then, its discovery. Planners decided on a date for the celebrations as August 1928, as midway between the sesquicentennial of Cook's landing in January 1778 and of his death in the islands in February 1779. A resolution was passed by the legislature of the Territory of Hawaii to give the celebrations official status, and to ask the federal government to have the armed forces participate. The resolution requested that Washington invite the United Kingdom (Cook's allegiance) and other nations. It also asked the federal government to issue a half dollar and postage stamps in honor of the anniversary. At the time, commemoratives were not sold by the government—Congress, in authorizing legislation, designated an organization which had the exclusive right to purchase the coins at face value and vend them to the public at a premium. In the case of the Hawaii half dollar, the Cook Sesquicentennial Commission of Hawaii was the designated group.
Bruce Cartwright, Jr., was in charge of choosing a coin design for the Cook commission. Mrs. Ethelwyn Castle, a civic-minded person, arranged for him to meet Juliette May Fraser, a local artist. Cartwright had prepared cartoon-style drawings, with the portrait of Cook based on a Wedgwood plaque that had been owned by Queen Emma, showing the explorer facing right. Within two days, Fraser had produced sketches. On November 2, Charles Moore, chairman of the Commission of Fine Arts wrote to Assistant Director of the Mint Mary M. O'Reilly that Juliette Fraser's sketches were excellent and would translate well into a coin.
The Commission of Fine Arts met, and, at the suggestion of sculptor-member Lorado Taft, decided to ask Buffalo nickel designer James Earle Fraser (no relation) who would be most suitable to turn the sketches into plaster models, from which the Mint could make coinage dies and hubs. James Fraser suggested Peace dollar designer Anthony de Francisci, but sculptor Chester Beach was engaged instead.