The Siboney were the first to inhabit the islands of Antigua and Barbuda in 2400 B.C., but Arawak and Carib Indians populated the islands when Columbus landed on his second voyage in 1493. Early settlements by the Spanish and French were succeeded by the English who formed a colony in 1667. Slavery, established to run the sugar plantations on Antigua, was abolished in 1834. The islands became an independent state within the British Commonwealth of Nations in 1981.

Antigua was explored by Christopher Columbus in 1493 and named for the Church of Santa Maria de la Antigua in Seville. Antigua was colonized by Britain in 1632; Barbuda was first colonized in 1678. The country joined the West Indies Federation in 1958. With the breakup of the federation, it became one of the West Indies Associated States in 1967, self-governing its internal affairs. Full independence was granted Nov. 1, 1981.

The Bird family has controlled the islands since Vere C. Bird founded the Antigua Labor Party in the mid-1940s. While tourism and financial services have turned the country into one of the more prosperous in the Caribbean, law enforcement officials have charged that Antigua and Barbuda is a major center of money laundering, drug trafficking, and arms smuggling. Several scandals tainted the Bird family, especially the 1995 conviction of Prime Minister Lester Bird's brother, Ivor, for cocaine smuggling. In 2000, Antigua and 35 other offshore banking centers agreed to reforms to prevent money laundering.

In March 2004, the Bird political dynasty came to an end when labor activist Baldwin Spencer defeated Lester Bird, who had been prime minister since 1994. In 2005, income tax, which had been eliminated in 1975, was reintroduced to help alleviate Antigua's deficit.

Tourism continues to dominate the economy, accounting for more than half of GDP. Weak tourist arrival numbers since early 2000 have slowed the economy, however, and pressed the government into a tight fiscal corner. The dual-island nation's agricultural production is focused on the domestic market and constrained by a limited water supply and a labor shortage stemming from the lure of higher wages in tourism and construction. Manufacturing comprises enclave-type assembly for export with major products being bedding, handicrafts, and electronic components. Prospects for economic growth in the medium term will continue to depend on income growth in the industrialized world, especially in the US, which accounts for slightly more than one-third of tourist arrivals.