Portobelo was founded in 1597. From the sixteenth to the eighteenth centuries it was an important silver-exporting port in New Granada on the Spanish Main and one of the ports on the route of the Spanish treasure fleets.
The city was also victim of one of Captain Henry Morgan's notorious adventures. In 1668, Morgan led a fleet of privateers and 450 men against Portobelo, which, in spite of its good fortifications, he captured and plundered for 14 days, stripping it of nearly all its wealth. This daring endeavour, although successful, also proved particularly brutal as it involved rape, torture, and murder on a grand scale.
On November 21, 1739, the port was again attacked and captured by a British fleet, commanded this time by Admiral Edward Vernon during the War of Jenkins' Ear. The British victory created an outburst of popular acclaim throughout the British Empire, and many streets and settlements in the British Isles and the Thirteen Colonies were named Portobello. The battle demonstrated the vulnerability of Spanish trading practices, and led to a fundamental change in them. The Spanish switched from large fleets calling at few ports to small fleets trading at a wide variety of ports. They also began to travel around Cape Horn to trade on the West coast. Portobelo's economy was severely damaged, and did not recover until the building of the Panama Canal.
Today, Portobelo is a sleepy city with a population of fewer than 5,000. It has a deep natural harbor. In 1980 the ruins of the fortification, along with nearby Fort San Lorenzo, were declared a World Heritage Site.