Its importance started to increase by the mid-1880s when the Portuguese administration, under then Governor-General Carlos Eugénio Correia da Silva, Count of Paço de Arcos, decided to transfer the seat of the Pragana Nagar Avely municipality further inland from Darará.

On 11 February 1885, by decree from the Portuguese Ministry of the Overseas, Silvassa was designated as a town (vila), and given the name of Paço de Arcos.

[5] However, the endemic name prevailed, and the town continued to be known locally and beyond as Silvassa, being referred-to as such in official documents.

Gujarati and Hindi are the most commonly spoken languages in Silvassa; as the city lies in the northern part of Nagar Haveli, Gujarati and its dialects are more widely spoken compared to the southern part of Nagar Haveli, where Marathi, Konkani and its dialects hold prominence.

As with most larger towns and cities in India (with a somewhat centralised location), Silvassa is home to people from virtually every part of the nation, with numerous languages being spoken there besides the widespread Hindi, Marathi or Gujarati; one may hear Bengali, Bhojpuri, Haryanvi, Kannada, Malayalam, Marwari, Odia, Punjabi, Tamil, Telugu or Urdu, amongst other tongues, when in Silvassa.

Silvassa hosts more than 200,000 floating population, coming from all parts of the country; the laborers mostly hail from Uttar Pradesh, Bihar and Odisha.