Whakatāne is part of the parliamentary electorate of East Coast, currently represented by Dana Kirkpatrick of the New Zealand National Party.

The town is the main urban centre of the eastern Bay of Plenty sub-region, which includes Whakatāne, Kawerau, and Ōpōtiki, stretching from Otamarakau in the west to Cape Runaway in the northeast and Whirinaki in the south.

According to Māori tradition Toi-te-huatahi, later known as Toi-kai-rakau, landed at Whakatāne about 1150 CE in search of his grandson Whatonga.

Failing to find Whatonga, he settled in the locality and built a pa on the highest point of the headland now called Whakatāne Heads, overlooking the present town.

Wairaka, a chieftainess, said "Kia whakatāne au i ahau" ("I will act like a man"), and commenced to paddle – something that women were not allowed to do.

Its role culminated in 1869 with raids by Te Kooti's forces and a number of its few buildings were razed, leading to an armed constabulary being stationed above the town for a short while.

Whakatāne beach heralded a historic meeting on 23 March 1908 between Prime Minister Joseph Ward and the Māori prophet and activist Rua Kenana Hepetipa.

The town was a notable shipbuilding and trade centre from 1880 and with the draining of the Rangitāiki swamp into productive farmland from 1904, Whakatāne grew considerably.

[10] Whakatāne has in recent years benefited from its relative dominance over numerous smaller and less prosperous towns surrounding it, such as Te Teko (affectionately known as 'Texas') and Waimana, and its popularity as a retirement and lifestyle destination[citation needed].

The 'First International Conference on the Cultural and Intellectual Property Rights of Indigenous Peoples' was held in Whakatāne from 12 to 18 June 1993.

The mouth of the Whakatāne River and Ohiwa Harbour have both provided berths for yachts, fishing trawlers and small ships since European settlement of the area.

Heavy rain struck the Bay of Plenty region between 16 and 18 July 2004, resulting in severe flooding and a state of civil emergency being declared.

A total of 245.8 mm (93⁄4") of rain fell in Whakatāne in the 48-hour period and many small earthquakes were also felt during this time, loosening the sodden earth and resulting in landslips that claimed two lives.

[27] The town's main industries are diverse: forestry, tourism, agriculture, horticulture, fishing and manufacturing are all well-established.

While farming and forestry activities remain the dominant sectors, tourism is a growing industry for Whakatāne, with a continued increase in guest nights in the district.

Popular tourist activities include the beaches, swimming with dolphins, whale watching, chartered fishing cruises, surf tours, amateur astronomy, hunting, experiences of Maori culture and bush walking.

offshore of Ōpōtiki, expected to produce 20,000 tonnes of mussels per annum by 2025 and add $35 million to regional GDP.

In 2006, a large-format shopping centre (The Hub Whakatane) was built on the edge of town anchored by national chains Bunnings Warehouse and Harvey Norman.

[31][32] Whakatane Airport is served by Air Chathams with direct flights to Auckland using Saab 340 aircraft.

Furthermore, once-daily return bus services operate to Tauranga, en route from Kawerau and Ōpōtiki on alternate weekdays.