[6] Small, open and natural, the port has a sandy seabed dotted with numerous reefs that cause available vessel draft to vary substantially.

[7]: S-19 [8] A natural reef along the port's perimeter gives protection from the severe weather that can occur during Timor-Leste's annual rainy or monsoon season.

[10]: 42–43 In 1769, a later governor of Portuguese Timor, António José Teles de Meneses, sought to break the influence of powerful local families in Lifau, Oecusse, his then residence, by moving the colonial administration and 1,200 people to the site of what would become Dili.

[11][12] According to John Crawfurd, writing in 1820, between 10 and 12 English ships would put in to Dili each year to re-provision during the British occupation of the Moluccas between 1810 and 1814.

[10]: 54 The Plano do Porto e Cidade de Dilly, a map of Dili published by T. Andrea and T. Machado in 1870, confirms that the hydrographic charting of the harbour had been completed, and that the anchorage was protected by a lighthouse on one side and a fortaleza named Carqueto on the other.

[10]: 64 At least from the 1860s onwards, Europeans who visited Dili via its port in the 19th century tended to write negatively about the locality's poor state of public health, surrounded as it was by swamps and mud flats.

[10]: 63–64  So, eg, Anna Forbes, wife of Henry Ogg Forbes, commented in the 1880s that: "No traveller will of choice visit Dilly, for its reputation as the unhealthiest port of the archipelago is not undeserved, and the report that one night passed in its miasmal atmosphere may result fatally deters any who would, except of necessity, go there ..."[10]: 64 Until well into the twentieth century, the port facilities at Dili were minimal.

More than a decade after World War II ended, the port was restored under governor Colonel Filipe Temudo Barata [de; pt] (1959–1963).

[15] Historian Geoffrey Gunn has asserted that "[t]he development of Dili's port facilities in the 1960s was laudable but also tended to benefit big importers and exporters.

On the evening of 26/27 August 1975, the Portuguese colonial administration was evacuated from Dili via the port to the offshore island of Atauro.

After capturing the city, the Indonesians led Chinese residents, members of Fretilin and other prisoners to the port area, shot them, and threw their bodies into the sea.

The victims included suffragette Rosa Bonaparte, her brother Bernardino Bonaparte Soares [de], Isabel Barreto Lobato (wife of Fretilin-appointed Prime Minister Nicolau dos Reis Lobato) and Roger East, the last remaining foreign reporter in Dili.

[22] During the ensuing Indonesian occupation of East Timor between 1975 and 1999, the port had international status, although access to it was limited by its moderate depth of 16–17 m (52–56 ft).

Regular Perintis passenger services were operated twice each month to Surabaya and Ujung Pandang, and less frequently to Jakarta, Irian Jaya, and Banyuwangi in East Java.

A former Russian hospital ship that had been converted into a floating luxury hotel, it remained in Dili for several years.

[27][28][29] In 2000, United Nations Transitional Administration in East Timor (UNTAET), which had taken over the administration of East Timor, asked the Japan International Cooperation Agency (JICA) to conduct a study aimed at developing a plan for the urgent rehabilitation for various items of infrastructure, including the port.

Since February 2000, two vessels had been berthing per day on average, and the report estimated that the cargo handling volume "might increase dramatically" that year by comparison with 1997.

Additionally, a rubber wheel loader was recommended to be installed once a final structure for the port management system had been established.

[4] By the middle of that decade, the port, although improved by Japanese grant aid, had a nearly saturated capacity, and its safety measures were not satisfactory.

However, the port warehouses, located within a secure area, were permanent structures with good drainage and corrugated iron roofing.

[36] However, issues with funding and subcontracting delayed progress, and the official ceremony launching the project was not held until 15 July 2019.

As of 2014, maintenance, management manuals, and routine port checks were nonexistent, and staff size, experience and budget were not sufficient, and accident records were not available.

[31] Government officials, especially former prime minister Dr. Mari Alkatiri, have expressed concern about how sea level rise (SLR) will affect the port.