The town became the focus of a distinctive regional identity and was home to liberal and radical thinkers such as Eugenio María de Hostos and the pro-independence activist Ramón Emeterio Betances.
"Maygüez" was the indigenous name for this river (the word means "clear water" in the language of its original inhabitants, the Taíno).
The Taínos had settled the area for hundreds of years before the town's founding, at the nearby settlement of Yagüeca (also spelled Yagüexa or Yaweka), which sits near a larger river, the Río Grande de Añasco (originally named "Guaorabo").
The Spanish Crown granted the founders the right to self-government in 1763, formally separating the town from the larger Partido de San Germán.
In 1777, two American frigates, the Endowok and the Henry, took refuge in Mayagüez Bay as to evade attack from the British ship HMS Glasgow.
The famous patriot, educator, sociologist, philosopher, essayist, and novelist Eugenio María de Hostos was born in Mayagüez in 1839.
Due to its physical isolation from the rest of the island (the city was founded on a coastal valley surrounded by mountains) and its need for self-sufficiency from Puerto Rico's main government (which, some of its current inhabitants[who?]
claim, lasts to this day) Mayagüez developed a peculiar local culture and a strong sense of regional pride that tends to distinguish its inhabitants from the rest of Puerto Rico's.
claim that this strong, fiercely independent culture was responsible for breeding not only liberal thinkers such as Eugenio María de Hostos, but also radical ones such as Dr. Ramón Emeterio Betances, the father of the Puerto Rican independence movement and first medical director of Mayagüez's Municipal Hospital (currently known as Hospital San Antonio), Segundo Ruiz Belvis, the father of the Puerto Rican Abolitionism movement and a former city administrator, and José de Diego, first president of the Puerto Rico House of Representatives and founder of the local College of Agriculture and Mechanic Arts.
However, lack of proper funding and the extent of the damage of the original structure forced the actual rebuilding of the church to be scaled-down considerably.
At one time, 80% of all tuna products consumed in the United States were packed in Mayagüez (the biggest employer, StarKist, had 11,000 employees working three daily shifts in the local plant's heyday).
Mayagüez was also a major textile industry hub; until very recently, almost a quarter of all drill uniforms used by the United States Army were sewn in the city.
A bomb exploded in the Plaza del Municipio during a January 11, 1975, celebration of the birthday of Eugenio María de Hostos hosted by the Puerto Rican Socialist Party.
The Fuerzas Armadas de Liberación Nacional Puertorriqueña attributed the attack to the CIA and the National Front for the Liberation of Cuba (FLNC), and within two weeks, retaliated by bombing the Fraunces Tavern in New York City.
The botched recovery of the ship's crew on May 15 by a hastily arranged multi-service task force off the island of Koh Tang became known as the Mayagüez Incident, considered by historians as one of president Gerald Ford's first foreign policy setbacks.