We have determined the distance and star formation history of the Local Group dwarf galaxy LGS 3 from deep Hubble Space Telescope WFPC2 observations. LGS 3 is intriguing because ground-based observations showed that, while its stellar population is dominated by old, metal-poor stars, there is a handful of young, blue stars. Also, the presence of HI gas makes this a possible ``transition object between dwarf spheroidal and dwarf irregular galaxies. The HST data are deep enough to detect the horizontal branch and young main sequence for the first time. A new distance of D=620+/-20 kpc has been measured from the positions of the TRGB, the red clump, and the horizontal branch. The mean metallicity of the stars older than 8 Gyr is Fe/H = -1.5 +/- 0.3. The most recent generation of stars has Fe/H ~ -1. For the first few Gyr the global star formation rate was several times higher than the historical average and has been fairly constant since then. However, we do see significant changes in stellar populations and star formation history with radial position in the galaxy. Most of the young stars are found in the central 63 pc (21), where the star formation rate has been relatively constant, while the outer parts have had a declining star formation rate.