The Cairu region was home to a large population of Aimoré people. The Portuguese arrived in the area early in the 16th century and soon established a sugarcane plantation. Francisco Romeo, administrator of the Captaincy of São Jorge dos Ilhéus founded a small settlement in Cairu based on its mild climate. The settlers displaced the Aimoré and the settlement, known as the Vila de Nossa Senhora do Rosário do Cairú, was established in 1608. It was located on an elevation overlooking the Tinharé Channel, which leads directly to the Atlantic Ocean. The Franciscans arrived in 1654 to build the Convent and Church of Saint Anthony on another high point in the settlement. Cairu became a major producer of manioc flour and timber in the 17th century. The town was forced to contribute 166$000 annually for three decades to fund the rebuilding of Lisbon after the 1755 earthquake.