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Sisters Elizabeth and Rachel Lazarus, who died within a few months of each other, both left money in their wills to establish the home, which was to be named in honour of their late mother Isabella. The Trust transferred the responsibility for the trust to the Sir Moses Montefiore Home, which had been providing care to aged Jewish people in Sydney since 1889. When it built new premises on the Hunters Hill site in 1939, it also built the children's home. Isabella Lazarus Home was opened on 26 November 1939.
During World War II the Australian Army took over the Hunters Hill site, and both the aged care home and the children's home relocated. From 1942 until 1945 the children lived at the corner of Garnet and Stanhope Road, Killara. The children's home was rededicated in 1946.
In 1965 the children's home moved to 'Parklands', St Marys Avenue, Waverley. The home closed in 1967.
After the children's home was relocated to Waverley in 1965 the original building at Hunters Hill was demolished and aged care services were expanded. Sir Moses Montefiore Home at Hunters Hill has retained photographs and the home's foundation stones in its Heritage Gallery. It has also auspiced reunions of former residents.
At a successful reunion in 2011 former residents shared memories of their time in care. Reunion co-organiser Agnes Barna told the Australian Jewish News that one of the intentions of the reunion was to help former residents made sense of their time at the Home, in the context of their lives:
'People really appreciated the honesty. [They] spoke of some good times and some bad times. They acknowledged all of the not-so-good experiences ... Strong connections were made, that was really one of the intentions and that was certainly fulfilled. ... We could reflect and talk about what that experience meant and how we've been able to process that and bring it into who we are now … We remembered so much more because we were able to talk, and of course looking at the photos, it really made it a rich experience.'
