Public education began in Panama soon after freedom from Colombia in 1903. The first efforts were guided by an extremely paternalistic view of the goals of education, as demonstrated in comments made in a 1913 meeting of the First Panamanian Educational Assembly, "The cultural heritage given to the child should be determined by the social position he will or should occupy. For this reason education should be different in accordance with the social class to which the student should be related." This elitist focus changed rapidly under United States determine.

Education is compulsory for 6 years and is provided free by the government through the university level. The government spent 17.6 % of its budget on education in 1998. Wealthier families usually send their children to the numerous private schools in the cities. In 1995, 361,900 elementary and 216,200 high school students were listed in the nation. School attendance by elementary-age children is nearly universal. Panama has one of the highest literacy rates in the region, 97 %.