Originally known as Ekab ("Black Earth"), what is now the northern district of the state of Quintana Roo was thickly populated by people who spoke the language now known as Mayan when the Spanish arrived, according to the conquistador Bernal Díaz del Castillo. In the years after the Conquest, most of the population died off or left as a result of disease, warfare, piracy, and other famines, leaving only small settlements on Isla Mujeres and Cozumel Island. The early history of the area is discussed in "Boca Iglesias, Where the Conquest of Mexico Began" by Fidel Villanueva, official historian of Isla Mujeres.

The city of Cancún resulted from a 1967 study by Banco de México to determine the feasibility of capturing more dollars and other foreign exchange through tourism development. Although the story goes that Cancún was picked by a computer, it was actually selected after extensive research and exploration by the bank's researchers. Banco de México obtained a $27 million loan from the Inter-American Development Bank to install the first infrastructure. When development was started on Jan. 23, 1970, Isla Cancún had only three residents, caretakers of the coconut plantation of don José de Jesús Lima, who lived on Isla Mujeres, and there were only 117 people living in nearby Puerto Juárez, a fishing village and military base.

 
shield fontaine of Benito Juárez"Due to the reluctance of investors to bet on an unknown area, the Mexican government had to finance the first nine hotels." [1] The first hotel financed was the Cancun Caribe (now a Hyatt hotel), but the first hotel actually built was the Playa Blanca, which later became a Blue Bay hotel, and is now Temptation Resort. The entire project was master-planned, with the island (soon connected to the mainland by causeways) devoted almost exclusively to tourism facilities, while workers housing and service areas were located on the mainland in what became the city of Cancún.

The city has grown rapidly over the past thirty years to become a city of approximately 600,000 residents, covering the former island and the nearby mainland. Most 'cancunenses' here are from Yucatán and other Mexican states. A growing number are from the rest of America and Europe. The municipal authorities have struggled to provide public services for the constant influx of people, as well as to control squatters and irregular developments, which now occupy an estimated ten to fifteen percent of the mainland area on the fringes of the city.