Sébaco is a town and a municipality in the Matagalpa department of Nicaragua.

Situated at the junction of the Pan-American Highway and the Rio Grande de Matagalpa, Sébaco is the largest city of the agricultural Sébaco Valley, one of the most fertile areas in Nicaragua.

King Charles I of Spain named the area "The Very Noble City of Sébaco" by decree.

In 2006 the National Assembly of Nicaragua officially named the city Sébaco.

When the Spanish arrived in the area, they were unable to pronounce the original name of this town, and due to their Tlaxcalan interpreters speaking Nahuatl, it was wrongly documented and over time the pronunciation became Sébaco.