This paper investigates the low frequency (< 30 Hz) oscillations in isolated microgrids (IMGs) with smart loads (SLs) alongside converter-interfaced distributed generators (CDGs) fuelled by renewable energy resources (e.g. wind, solar) with battery energy storage. In an IMG with normal loads (active or passive), such oscillations are typically associated with the droop control of the CDGs operating in grid forming mode. This paper shows that SLs have marginal influence on these low frequency oscillations but introduce a new oscillatory mode at a slightly higher frequency (>20 Hz). First, the stability analysis model (linearized state-space model) of an IMG is extended to include the dynamics of a smart load with a series-shunt converter arrangement in its voltage compensator. It is shown that the dynamics of the phase-locked loop (PLL), DC link along with the control loops of the series and shunt converters of the smart load dictates the lower limit of its droop gain for stable operation. This is not apparent from the simplified SL models (i.e. neglecting the dynamics of the shunt converter and DC link) reported previously. Impact of smart loads on low frequency oscillations in IMGs is demonstrated in this paper through stability analysis and time domain simulation.