Lasam was once a part of Gattaran, but as the population increased, the residents of the western part of the town asked that it be created a separate municipality.
In 1950, Lasam was created as a municipality by virtue of Republic Act No. 507 signed by then President Elpidio Quirino. It was named after the late Cagayan Governor Honorio Lasam. It was officially inaugurated as a town separate from Gattaran in January 1951.
Ignacio Jurado was appointed as the first mayor and his first major task was to build Lasam as a new town separate from the mother municipality of Gattaran.
Lasam is primarily an agricultural community and its people derive their income mainly from farming and livestock raising.