The area around Foz do Iguacu was inhabited by a group native people called the Gurarani, a word that means "warrior". The falls were discovered by foreigners however, when Spanish explorer Cabeza de Vaca found them and eventually settled on Quedas do Iguazu for their name, based on a name the Guarani had for it.  

The city is at the border of three countries as are defined today: Brazil, Paraguay, and Argentina. The falls was originally part of Paraguay until 1860 when borders changed and Brazil gained most of the control, a result of what is known as the War of the Triple Alliance between the three.

The town was very unpopulated and actually not officially a city until 1914. But as more people came on to the stunning beauty of the region, more and more attention was paid until it was made into a park in 1939.

Today the city and falls serves as a major tourist destination for South Americans and other nationalities. Its location should serve as an important one as well, tying divisions between these three large countries on which it borders. Trade and employment opportunites is shared between these three nations in the city and park.