Hugh Macdonald was a merchant, landowner, and politician in Panmure Island and Georgetown, Prince Edward Island. He was born on the Eilean Shona, Inverness, Scotland, on 27 July 1788 to Andrew Macdonald (ca. 1752-1833) and Isabella Macdonald (ca. 1760-1840) of the Island of Canna, daughter of Ronald of Borrodale. In April 1826, Hugh married Catherine Kennedy Macdonald (ca. 1795 - 21 April 1872), daughter of Archibald MacDonald of Rhue, Arisaig, Scotland, whose sister Mary had married Hugh’s brother Angus the previous year. They had five children: Andrew Archibald (14 February 1829 - 21 March 1912); Ann Isabella? Elizabeth? (28 December 1830 - 17 January 1832); Eliza Marie (1832-1912); Archibald John (10 October 1834 - 17 August 1917); and Augustine ""Austin"" Colin (20 June 1837 - 16 July 1919).

Hugh Macdonald immigrated to Panmure Island, along with his parents and siblings, some time between May and November 1806. He immediately became involved in his father's business interests in the Three Rivers area and Miramichi, New Brunswick. The company was know as Andrew Macdonald and Sons until 1822 when Hugh established a partnership with his brother Angus which they operated from a store at Brudenell Point. As early as 1829, Andrew, who was in ill health, encouraged Hugh to return to Panmure Island to attend to Andrew's business affairs. To that end, Hugh dissolved his partnership with Angus on 20 August 1830. He then moved back to Panmure Island with his wife Catherine and children.

Besides his business interests, Hugh was also heavily involved in public service. In 1830, he was one of the first Roman Catholics elected to the House of Assembly. Over the next twenty years, he also held the positions of Collector of Customs and Excise, Controller of Navigation Laws for Georgetown and Three Rivers, High Sheriff, Judge of the Small Debt Court for King's County, Justice of the Peace, Members of the Board of Health, and Collector of Land Taxes. It was as a result of his duties as Collector of Customs that he was forced to relocate his office, and thus his family, from Panmure Island to Georgetown ca. 1840. Hugh spent the remainder of his life in Georgetown, dying there on 10 November 1857 at the age of 70.