In 1934, Amy Ashwood Garvey and Sam Manning opened the Florence Mills Social Club, a jazz club that became a gathering place for supporters of Pan-Africanism, at number 50.
The first boutique, His Clothes, was opened by John Stephen in 1957 after his shop in Beak Street burned down and was followed by I Was Lord Kitchener's Valet, Gear, Lady Jane, Mates, Ravel, and others. Round the corner in Kingly Street, Tommy Roberts opened his gift shop Kleptomania. He moved to Carnaby Street in 1967 and went on to make fame in the King's Road, Chelsea, with his Mr Freedom shop.
By the 1960s, Carnaby Street was popular with followers of the mod and hippie styles. Many independent fashion boutiques such as Ariella, and designers such as Mary Quant, Marion Foale and Sally Tuffin, Lord John, Merc, Take Six, and Irvine Sellars had premises in the street and various underground music bars such as the Roaring Twenties opened in the surrounding streets. Bands such as the Small Faces, The Who, and The Rolling Stones appeared in the area to work (at the legendary Marquee Club round the corner in Wardour Street), shop, and socialise, it became one of the coolest destinations associated with 1960's Swinging London.
The Carnaby Street contingent of Swinging London stormed into North American and international awareness with the 15 April 1966 publication of Time magazine's cover and article that extolled this street's role: Perhaps nothing illustrates the new swinging London better than narrow, three-block-long Carnaby Street, which is crammed with a cluster of the 'gear' boutiques where the girls and boys buy each other clothing..
In October 1973, the Greater London Council pedestrianised the street. Vehicular access is restricted between 11 am and 8 pm. A comparison of before and after number of pedestrians entering the area indicated a 30% increase in pedestrian flows as a result of the pedestrianisation. A campaign commenced early in 2010 to call for pedestrianisation in the adjacent area of Soho.
Westminster City Council erected two green plaques, one at 1 Carnaby Street dedicated to fashion entrepreneur John Stephen, who began the Mod fashion revolution and another at 52/55 Carnaby Street is dedicated to the Mod pop group The Small Faces and their manager Don Arden.