The city is the birthplace of many popular figures of Honduran literature such as Ramón Amaya Amador, whose manuscripts, collection of books, writing table, and ashes are located in Olanchito.

Hernando de Saavedra, Governor of Honduras, had a dispute with his counterpart in Nicaragua Pedro Arias Dávila over the rich gold deposits and rivers of Olancho.

The Olancho natives were mistreated, and unexpectedly rebelled and attacked the Spaniards; and Captain Juan de Grijalva, one of the conquerors of the Aztec empire, was killed in the rebellion.

Olancho was flourishing as a mining town, and produced huge amounts of gold and silver that were shipped from the ports of Truxillo and Puerto Caballos.

Over time, people moved to the left bank of the Aguán river and established a place they called San Jorge de Olancho (Nuevo) on the route leading to the native village of Agalteca.

"[9] In 1797, there was still a war between Spain and England with the following being reported: "In part this Captaincy General directed by the Lord Mayor Governor of the Province of Comayagua, Ramon Anguiano, from Olanchito early this month have reported the following: On April 26, before five in the afternoon, the British placed, two warships and a brigantine at Truxillo Port given these and other provisions they went to the place known as La Ofrecedora, which contributed effectively to the back the Governor Intendant, as expressed through a cordon of Olanchito troops who had settled in around Sona Guera".

[10] Due to this situation, in the late 18th century, the archive and treasury of Real Hacienda de Truxillo were moved to the town of Olanchito, where it is still located to this date.

[11] As of July 2017, Olanchito is the most important city in the department of Yoro due to its growing achievements in education, industry, livestock, and agriculture.