[2] In its first year, Hatillo had 910 people; increasing to 2,663 inhabitants the following year distributed among the central town and the barrios of Carrizales, Capáez, Naranjito, Corcovado, Buena Vista (formerly Yeguada Occidental), Campo Alegre (formerly Yeguada Oriental), Pajuil, Bayaney, Aibonito, and the Pueblo.

Puerto Rico was ceded by Spain in the aftermath of the Spanish–American War under the terms of the Treaty of Paris of 1898 and became a territory of the United States.

In 1899, the United States Department of War conducted a census of Puerto Rico finding that the population of Hatillo was 1,148.

[3] Hatillo, like several other municipalities on the island, experienced boundary changes from the 1902 municipality consolidation law (Consolidación de Ciertos Términos Municipales de Puerto Rico) in which Hatillo was annexed temporarily into neighboring Camuy.

Three years later the territorial legislature approved the reformation of Hatillo as a separate municipality (independent town) from Camuy in 1905.

The 75 dairy farms which produce much of the milk consumed in Puerto Rico were greatly affected.

The municipal buildings, central square and large Catholic church are located in a small barrio referred to as "el pueblo".

The Fiestas Patronales de Nuestra Señora del Carmen is a religious and cultural celebration that generally features parades, games, artisans, amusement rides, regional food, and live entertainment.

[30][23] The festival has featured live performances by well-known artists such as Sonora Ponceña, Andy Montañez, Pedro Capó, Sie7e and El Gran Combo de Puerto Rico.

The early tradition of the festival required that the male population dress as women and they would visit each residence where the owners would offer them food and drinks.