Granada was founded in 1524 by the Spanish conquistador Francisco Hernández de Córdoba, sent to these lands by Pedrarias Dávila from Panama. Hernández de Córdoba established the city on the shore of the huge Lake Cocibolca (Lake Nicaragua), in a region inhabited by Indigenous peoples, and gave it the name Granada in memory of the Spanish city of the same name, recently reconquered on the Iberian Peninsula.
Granada is considered one of the oldest cities founded by Europeans on the American continent that has kept continuity and location to this day. That same year, Hernández de Córdoba also founded León, in the west, laying the foundations of the two great cities that would mark the history of Nicaragua. The founder's name was also immortalized in the national currency: the córdoba.
The choice of the site was no accident. Lake Cocibolca, besides providing water and resources, was connected to the Caribbean Sea through the San Juan River, which opened Granada an outlet to the Atlantic. That strategic position would make the city, over time, an important commercial port, but also a target for attacks. From its founding, Granada was tied to its lake, its hallmark to this day.
Granada's great advantage was its condition as an inland port with an outlet to the sea. Lake Cocibolca drains through the San Juan River, which runs east until it empties into the Caribbean Sea. This made it possible for vessels to arrive from the Atlantic, come up the San Juan River, cross the lake and reach Granada, and for the region's goods to leave from there to the outside world.
Thanks to this route, Granada became one of the main commercial centers of colonial Central America. Through its port passed the region's products and goods that connected it with Spain and the rest of the empire. The city prospered, grew rich and built churches, convents and mansions, establishing itself as an important and opulent city by the standards of the time.
That same wealth, however, came at a cost. The route that gave Granada its prosperity —the lake and the San Juan River— was also an access route for its enemies. Its fame as a rich city and the possibility of arriving by water from the Caribbean made Granada a coveted target for pirates, who during the 17th century organized expeditions to come up the river and sack it.
Granada's prosperity made it a target for the pirates and buccaneers who prowled the Caribbean in the 17th century. Despite being inland, far from the coast, the city was not safe: the raiders discovered that by coming up the San Juan River from the Caribbean Sea and crossing Lake Cocibolca they could reach Granada and sack it.
Throughout the 17th century, Granada suffered several pirate attacks. Bands of filibusters and buccaneers, some tied to Spain's rival powers, sailed upriver, got past the defenses and attacked the city, taking booty and sowing terror among its inhabitants. These assaults left a deep mark on the city's memory and prompted the construction and reinforcement of fortifications along the route, especially on the San Juan River, to try to stop the invaders.
The pirate threat was one of the great conditioning factors of Granada's colonial life and of the whole region of the lake and the San Juan River. The fortresses built to defend that route —of which there are still remains downriver— are testimony to that era when the city's wealth attracted both trade and danger.
From the colonial era, and very especially after independence from Spain, Granada and León starred in one of the deepest rivalries in the history of Nicaragua. Granada, a rich merchant city on the lakeshore, became a stronghold of the conservative elites; León, in the west, seat of the university and of a more reformist spirit, was the stronghold of the liberals. That clash between two cities and two visions of the country marked national life throughout the 19th century.
The rivalry was not only political, but also economic and cultural, and it often turned into armed conflicts over hegemony and over which would be the country's capital. Neither of the two accepted the other's primacy. This chronic instability was so serious that, in 1852, it was decided to move the capital to Managua, an intermediate and neutral city, precisely to settle the dispute between the two rivals.
The clash between Granada and León was, to a large extent, the engine of Nicaraguan politics in the first half of the 19th century, and its shadow reached even one of the darkest episodes in the country's history: the arrival of the adventurer William Walker, who knew how to take advantage of those internal conflicts to seize power.
One of the most dramatic episodes in the history of Granada is tied to the American William Walker, an adventurer and filibuster who in the 1850s took advantage of the internal wars between Nicaraguan liberals and conservatives to intervene in the country. Initially called in by the liberals of León as military support, Walker gradually accumulated power until he proclaimed himself president of Nicaragua in 1856, in an episode that scandalized the whole Central American region.
Walker's ambitions —which included expansion projects and, according to many interpretations, the re-establishment of slavery— provoked a war: the neighboring countries of Central America united to expel him in the so-called National War. Cornered and forced to withdraw from Granada, Walker made a brutal decision: he ordered the city burned and destroyed before abandoning it, in late 1856.
From that episode remained an image and a phrase for history: among the smoking ruins, Walker's men left a sign with the inscription 'Here was Granada' ('Aquí estuvo Granada'), as a cynical testimony to the destruction. The city, however, was rebuilt in the following years, recovering its colonial layout and its splendor. Walker was finally defeated and, years later, captured and executed by firing squad in Central America.
After the fire of 1856, Granada was rebuilt keeping its colonial grid layout and its character, raising its churches, convents and mansions anew. Throughout the 19th and 20th centuries, the city kept its historic imprint and its stately atmosphere, even after the country's political center had already moved to Managua. Granada remained a symbol of Nicaraguan heritage and identity.
In recent decades, Granada underwent a notable process of restoration and revaluation of its colonial heritage, which made it one of the main tourist destinations in Nicaragua. Its colorful mansions, its churches (the Cathedral, La Merced, San Francisco with its museum of pre-Columbian Zapatera statues), its Central Park and its La Calzada street draw visitors from all over the world, who find in it one of the best-preserved colonial cities in Central America.
To that heritage is added a privileged natural setting: Lake Cocibolca and its archipelago of Las Isletas, Mombacho volcano with its cloud forest and the nearby Laguna de Apoyo. Granada thus combines history, architecture, lake and volcanoes in one place. Today it's also a cultural hub, host of events like the International Poetry Festival, and a cosmopolitan city where Nicaraguans and a community of foreign residents drawn by its beauty and its climate live side by side.