Labuan's close proximity to Negara Brunei Darussalam has had a major influence on the island's socio-economic and cultural evolution. More than 60% of the 60,000 local are descendents of the Brunei Malays.
As such, Bahasa Brunei is the major lingua franca on the island.
The Brunei Malays The Brunei Malays are found along the west coast of Sabah as far as Papar and in Limbang in Sarawak and the 5th District area of Brunei. They originated from the Brunei Sultanate, which had survived for five centuries and at one time included present day Sarawak and some parts of Sabah. As Brunei lost territory during the 19th century, the cultivable area shrank and both the Malays and Kedayans, whose homeland was Brunei, migrated to neighbouring areas, including Labuan which was virtually uninhabited when the British took over. The well-known water villages of Patau-Patau and Kampung Bebuloh were set up by the Brunei Malays, carrying on their traditional lifestyle of living in stilt houses over the sea. These villages consist of large communities with shops, surau and other facilities. They have also settled on land, especially in the Kampung Rancha-Rancha, Lubuk Temiang, Gersik, Tanjung Aru and Pantai areas. Their dialect differs somewhat from the Peninsula Malay dialect. Some of their customs too, are slightly different. Traditionally these people were fishermen, sailors and traders. Today they fish using modern boats and methods, and many are employed in the civil service and service industry.