Nightly images offer a special data source for monitoring fishing activities. This study used images from the Defense Meteorological Satellite Program (DMSP)/Operational Linescan System (OLS) to analyze the early development of lit fisheries in the open South China Sea (SCS), which mainly occurred around the Zhong Sha and Xi Sha Islands. Based on peak detection and a fixed threshold, lit fishing positions were extracted well from filtered, high-quality DMSP/OLS images. The results indicated that fisheries experienced an apparent rise and fall from 2005 to 2012, with the numbers of lit fishing boats rising to a maximum of ~60 from 2005 to 2008, almost disappearing in 2009, peaking at ~130 from 2010 to 2011, and starting to decline in 2012. The fish price of major fishing targets declined by ~60% in 2009, which obviously impacted the year’s fishing operations. The reason for declined fishing operations in 2012 was that most of the lit fishing operations shifted farther south to fishing grounds around the Nan Sha Islands. We also explored factors shaping the distribution patterns of lit fisheries by using MaxEnt models to relate fishing positions to environmental variables. Major environmental factors influencing the distribution of lit fishing boats varied with years, of which water depth was the most important factor across years, with an optimal depth range of 1000–2000 m. In addition to depth, the distribution of lit fisheries was also influenced by SST, especially for the years 2005–2008, and a suitable SST was found between 26 and 28 °C. This study fills the knowledge gaps of the inception of lit fisheries and their dynamic changes in the SCS.