In 1462, Portuguese settlers arrived at Santiago and founded Ribeira Grande-the first permanent European settlement city in the tropics. In the 16th century, the archipelago prospered from the transatlantic slave trade. Pirates occasionally attacked the Portuguese settlements. Sir Francis Drake sacked Ribeira Grande in 1585. After a French attack in 1712, the city declined in importance relative to Praia, which became the capital in 1770.

Portugal changed Cape Verde's status from a colony to an overseas province in 1951 in an attempt to blunt growing nationalism. Nevertheless, in 1956, Amilcar Cabral, a Cape Verdean, and a group of Cape Verdeans and Guinea-Bissauans organized in Guinea-Bissau the clandestine African Party for the freedom of Guinea-Bissau and Cape Verde (PAIGC), which demanded improvement in economic, social, and political conditions in Cape Verde and Portuguese Guinea and formed the basis of the two nations' freedom movement. By 1972, the PAIGC controlled much of Portuguese Guinea contempt the presence of the Portuguese troops.

In December 1974, the PAIGC and Portugal signed an agreement providing for a transitional government composed of Portuguese and Cape Verdeans. On June 30, 1975, Cape Verdeans elected a National Assembly, which received the instruments of freedom from Portugal on July 5, 1975. Responding to growing pressure for pluralistic democracy, the PAICV called an emergency congress in February 1990 to discuss proposed constitutional changes to end one-party rule. Opposition groups came together to form the Movement for Democracy (MpD) in Praia in April 1990. The MpD won a majority of the seats in the National Assembly, and the MpD presidential candidate Mascarenhas Monteiro defeated the PAICV's candidate by 73.5% of the votes. Legislative elections in December 1995 increased the MpD majority in the National Assembly. The party won 50 of the National Assembly's 72 seats. A February 1996 presidential election returned President Mascarenhas Monteiro to office. Legislative elections in January 2001 returned power to the PAICV. The PAICV now holds 40 of the National Assembly seats, MpD 30, and PCD and PTS 1 each. In February 2001, the PAICV-supported presidential candidate Pedro Pires defeated former MpD leader Carlos Veiga by only 13 votes.