Before the Spanish arrived, this territory was inhabited by Chorotega Indians from the towns of Zapati, Nacaome, Paro, Cangel, Nicopasaya, Pocosí, Diriá, Papagayo, Namiapí and Orosi. The Corobicies lived on the eastern shore of the Gulf of Nicoya and the Nahuas or Aztecan in the zone of Bagaces.
In the 18th Century some neighbors of Rivas established their houses and cattle farms in the northern part of the Nicoya Peninsula at crossroads that connected the towns of Bagaces, Nicoya and Rivas. The place was baptized after a famous Guanacaste tree that grows in the neighborhood.
In 1824-25 the territory of Guanacaste was annexed to Costa Rica. In 1836 the town of Guanacaste was declared the capital of the Guanacaste province. In 1854 the town of Guanacaste was renamed Liberia.