[3] It borders the Paraguaçu River, 20 km (12 mi) upstream from Baía de Todos os Santos.

Maragogipe was a major center of sugar cane and tobacco production, and became home to large slave-holding plantations.

After the abolition of slavery in Brazil in 1888 the Afro-Brazilian population lived as tenant laborers until recently as "21st century slaves", unable to fish or grow staple crops.

They were attracted by the abundance of timber and easy maritime accessibility of the Paraguacu River and Bay of Iguape.

Numerous sugarcane plantation appeared in the region in the 1570s; the Portuguese also extracted timber and grew cassava.

The town served as one of many ports to facilitate commerce along the Paraguaçu; the settlement was on the busy transportation route between Cachoeira to the northeast and Salvador to the west.

A roads inland to São Félix was built in 1807, and regular steamboat service connected Maragogipe and Salvador by 1839.