stylistic:tone
Etymology

The definite origin of the name Panama is unknown. There are several theories. One states that the country was named after a commonly found species of tree (Sterculia apetala, the Panama tree). Another states that the first settlers arrived in Panama in August, when butterflies are abundant, and that the name means "many butterflies" in one or several of the indigenous American Indian languages that were spoken in the territory prior to the Spanish colonization. Another theory states that the word is a Castilianization of the Kuna language word " bannaba " which means "distant" or "far away".

A commonly relayed legend in Panama is that there was a fishing village that bore the name "Panamá", which purportedly meant "an abundance of fish", when the Spanish colonists first landed in the area. The exact location of the village is unknown. The legend is usually corroborated by Captain Antonio Tello de Guzmán's diary entries, who reports landing at an unnamed village while exploring the Pacific coast of Panama in 1515; he only describes the village as a "small indigenous fishing town". In 1517, Don Gaspar de Espinosa, a Spanish lieutenant, decided to build a trading post in the same location Guzmán described. In 1519, Pedro Arias Dávila decided to establish the Spanish Empire's Pacific port at the site. The new settlement replaced Santa María la Antigua del Darién, which had lost its function within the Crown's global plan after the Spanish exploitation of the riches in the Pacific began.

The official definition and origin of the name as promoted by Panama's Ministry of Education is the "abundance of fish, trees and butterflies". This is the usual description given in social studies textbooks.