Ibiza's history dates back to the Phoenicians (around the 7th century BC), although there is evidence of earlier human occupation. It was the Phoenicians who began to build settlements and to communicate with the outside world. The excellent location of Ibiza in the Mediterranean made communications easy, allowing it to trade with the whole of the Mediterranean region. Ibiza city was founded, under the name of IBSM (Ibosim), in 654 BC. The Carthaginians took over from the Phoenicians, and the island became a real trading post, where money was minted and various industries were established. After the fall of Carthage, Ibiza became close to Rome, and in the 1st century AD the island became a Roman municipality. Ibiza did not have a peaceful history, however. It was ideally placed for controlling Mediterranean routes, which actually resulted in lack of peace. The island suffered successive invasions, from the Vandals, Byzantines and Arabs. The Arabs were the people who made the most impact, and their heritage is reflected in place names and farming methods, as well as the ruins of Ibiza Castle.

Ibiza suffered another historical catastrophe in 1235. King James I, known as 'The Conqueror', consented an attack on the island to take it from the Arabs. The Christian expedition was led by Guillem de Montgrí (whose monument stands next to Ibiza Town Hall), the Archbishop of Tarragona, and the noblemen Nunó Sanç and Peter of Portugal. They won the attack, and divided the island into four districts, known as "quartons". Once occupied, the island had to be reorganised, and so the parish of Santa Maria, (whose first church made way for the present Ibiza Cathedral, which is located in the upper part of the old town, the "casco antiguo", known as Dalt Vila) was established.

Despite its conquest, Ibiza continued being besieged by pirates and privateers. Their repeated attacks on the island made defence important for religious buildings (which is why so many churches on Ibiza are fortified), and resulted in the construction of a wide network of towers on the coast (some inland), which acted as a lookout point as well a refuge. Many of these towers are still there.

In 1782 Ibiza was named a city. Three years later it was divided into parishes, and in 1830 it became part of the Balearic Province (created that same year) which incorporated the five municipalities which it now comprises: San Juan de Labritja, San José de sa Talaia, San Antonio de Portmany, Santa Eulalia del Río, and Ibiza town.

The last "invasion" Ibiza has undergone in its recent history is from tourism, which has become the island's main industry. The 1970s marked the start of a transformation that is still going on. The arrival of many hippies in the 1970s was part of an important cultural change to the island which had begun with the arrival of a large number of refugee artists from Central Europe during the Second World War. All these factors have given Ibiza the cosmopolitan and multi-ethnic character that it continues to develop nowadays, and have played a part in shaping the island's history.

"Diod., V, 16. Having already said sufficient concerning Sardinia, we shall now speak of the islands situated close by. After the aforementioned island is the one called Pitiusa, named thus by virtue of the many pines growing there. It is in the middle of the sea and is three days and as many nights' distant from the Pillars of Hercules; a day and a night are sufficient to reach Libia, and one day's journey separates it from Iberia. Its extension is the same as that of Corfu and it is moderately fertile: there are a few vineyards and oleasters grafted with olive-sprigs. And the wools produced there are of great renown, remarkable for their softness. It is crossed by pleasant meadows and hills and it has a city named Ebusos, and it is a colony of the Cathaginians. It also has ports worthy of mention and great walls as well as a considerable number of admirably built houses. It is inhabited by barbarians of all types, principally Phoenicians. The colonization of this island took place more than one hundred and seventy years after the founding of Carthage."

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