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The Royal Eye Hospital was founded in 1857 by John Zachariah Laurence with the assistance of Carsten Holthouse. It opened with two beds in a house in St George's Circus, Southwark, under the name of the South London Ophthalmic Hospital. It was enlarged in 1860 by the addition of an adjoining house and changed its name to the Surrey Ophthalmic Hospital, the first in a series of name changes. In 1863 it became the Ophthalmic Hospital, in 1869 the Royal South London Ophthalmic Hospital, and in 1892, on the opening of a new enlarged hospital building still in St George's Circus, the Royal Eye Hospital. In 1906 the first organised teaching course in connection with the hospital was started, The first full time Chair in Ophthalmology was established at the hospital in conjunction with the Royal College of Surgeons in 1943. Arnold Sorsby was the first professor.
The hospital was badly damaged by bombing in May 1941 forcing the closure of the In-Patient Department. This re-opened in March 1942 in a house acquired by the hospital in Upper Brighton Road, Surbiton. Outpatients continued to be treated in Southwark. The Surbiton hospital started its own small outpatient department in 1943. The Southwark hospital was able to re-open twenty-eight beds for in-patients in December 1944. These were supplemented by beds at Lambeth Hospital, which were made available by the London County Council for the use of Royal Eye Hospital patients.
The hospital was transferred to the National Health Service in 1948 and became part of King's College Hospital Group. This association was terminated in October 1956 at the request of the Royal Eye Hospital which then became part of the Lambeth Group of hospitals within the South West Metropolitan Region. The Lambeth Group amalgamated with the Wandsworth Group in 1964 to form the South West London Group. In about 1973 the Royal Eye Hospital, Southwark, was transferred to St Thomas' Hospital Group, which in 1974 became St Thomas' Health District (Teaching). The Royal Eye Hospital, Surbiton, passed to Kingston and Richmond Area Health Authority.
The Southwark hospital ceased to admit in-patients in 1976 when the Royal Eye Hospital ward opened in the new St Thomas' Hospital ward block. The outpatient department closed in 1980. The hospital buildings were taken over for administrative use first by Lambeth, Southwark and Lewisham Area Health Authority and then by Lewisham and North Southwark Health Authority.