They are best known for their graphic adventure games, and their many video game adaptations of Star Wars.
Lucas' early advice to the team at LucasFilm Games was "Stay small and don't lose any money". They were originally based at the Skywalker Ranch.
LucasArts' first Adventure game was Labyrinth based off the movie of the same name released in 1986. A year later. Maniac Mansion was released, which introduced the Scumm Engine (Script Utility For Maniac Mansion) an engine used in the vast majority of LucasArts' Adventure Games up until 1997.
"Zack McKracken and the Alien Mind Benders" followed in 1988 and then carried on to make Indiana Jones and the Last Crusade in 1989. in 1990, they broke through with The Secret of Monkey Island, which put them right in the video gaming market, competing alongside Sierra.
From that point, several of those games were given sequels. "Maniac Mansion" followed with Day of the Tentacle, "Indiana Jones and the Last Crusade" followed with Indiana Jones and the Fate of Atlantis, and more importantly, The Secret of Monkey Island followed with Monkey Island 2: LeChuck's Revenge. Collectively, these three games all achieved critical acclaim.
later in that decade interest in the adventure game genre began to wane. Consoles such as the PlayStation fired up the interest in 3D gaming. Despite this LucasArts continued to create adventure games up until the new millennium. In 1995, Full Throttle was released, and in 1997, The Curse of Monkey Island, the last Lucasarts game to utilize the Scumm Engine was released.
Grim Fandango was released in 1998. It used the GrimE engine, based off the Sith engine used in other Lucasarts games such as Star Wars Jedi Knight. It was rated very highly in reviews and even received a Game of the Year from GameSpot.
Despite positive reviews the game sold relatively poorly. In 2000, Lucasarts would release their last original adventure game, Escape from Monkey Island which released with favorable reviews. Sequels to "Full Throttle" and Sam & Max: Hit the Road were announced, but fell through, and were never released.
LucasArts stated that adventure game development wasn't appropriate in the current marketplace. Previous developers of the cancelled "Sam & Max: Freelance Police" moved onto Telltale Games in 2004.
LucasArts on Wikipedia