In 1542 Francisco de Montejo y León named the city after the town of Mérida in Extremadura, Spain. It was built on the site of the Maya city of T’hó (City of Five Hills) in reference to its pyramids. T’ho had been a centre of Mayan culture and activity for centuries: because of this, some historians consider Mérida the oldest continually-occupied city in the Americas.
Carved Maya stones from ancient T’ho were widely used to build the Spanish colonial buildings that are plentiful in downtown Mérida, and are visible, for instance, in the walls of the main cathedral. Much of Mérida’s architecture from the colonial period through the 18th century and 19th century is still standing in the centro historico of the city. From colonial times through the mid-19th century. Mérida was a walled city intended to protect the Peninsular and Criollo residents from periodic revolts by the indigenous Maya, several of the old Spanish city gates survive, but modern Mérida has expanded well beyond the old city walls.
In the late 19th century and the early 20th Century, the area surrounding Mérida prospered from the production of henequén. For a brief period, around the turn of the 20th century, Mérida was said to house more millionaires than any other city in the world. The result of this concentration of wealth can still be seen today. Many large and elaborate homes still line the main avenue called Paseo de Montejo, though few are occupied today by individual families. Many of these homes have been restored and now serve as office buildings for banks and insurance companies.