The site of Intramuros was originally a large Malayan-Islamic settlement named "Maynilad", ruled by three chieftains Rajah Sulayman, Lakan Dula and Rajah Matanda. The name came from "may nilad", "nilad" being a water plant whose star-shaped flowers clustered in abundance along the low-lying riverbanks. The strategic location of Maynilad, being on the Pasig River and the Manila Bay, made it an ideal location for indigenous Tagalog tribes to trade with other Asian civilizations, including Chinese and Islamic merchants who had come from China, Borneo and Indonesia. Maynilad was also the seat of power for native chiefs who ruled the area before Europeans first arrived in Luzon.
In 1564, conquistadors led by Miguel López de Legazpi sailed from New Spain (Mexico) and arrived on the island of Cebu in February 13, 1565. There they established the first Spanish colony in the archipelago. Having heard of rich resources of Manila by local natives, López de Legazpi dispatched two of his Lieutenant-commanders, Martín de Goiti and Juan de Salcedo to explore the northern regions of the Visayas.
In 1570, the Spaniards arrived in the island of Luzon. After quarrels had erupted between the Islamic natives and the Spaniards; Goiti and López de Legazpi's soldiers waged war on the people, before they were able to take control and establish a permanent settlement in the area. In 1571 after the natives were defeated in battle, López de Legazpi made a peace pact with Rajah Sulayman, Rajah Lakandula and Rajah Matanda; who, in return, handed over Manila to the Spaniards.
Citing the rich resources and location of Manila; López de Legazpi declared the area as the new capital of the Spanish colony in the Philippines on June 24, 1571. The King of Spain, delighted at the new conquest achieved by López de Legazpi and his men, awarded the city a coat of arms and declaring it Ciudad Insigne y Siempre Leal ("Distinguished and ever loyal city").
The planning of the city of Manila was commenced by López de Legazpi who had become the first Governor general on the islands. He established forts, roads, churches and schools. The plans for Intramuros were based on King Philip II's Royal Ordinance issued on July 3, 1573 in San Lorenzo, Spain. It's design was based upon a medieval castle structure and covered 64 hectares of land, surrounded by 8 metre thick stones and high walls that rise 22 metres.
Intramuros was completed in 1606 and it served as the center of political, military and religious power of the Spaniards during the time that the Philippines was a colony of Spain. Inside Intramuros; there are several Roman Catholic churches, like the Manila Cathedral and the San Agustin Church, convents and church-run schools, such as the Universidad de Santo Tomás, the Colegio de San Juan de Letran and the Ateneo Municipal de Manila, which were usually being run by religious orders such as the Dominicans, Augustinians, Franciscans and Jesuits. The Governor's Palace, the official residence of the Spanish Viceroyalties to the Philippines was originally in Intramuros before it was officially moved to Malacañang Palace and Fort Santiago. Only Spaniards and Mestizos were allowed to take part on political issues and take residence inside the walled city, Christian natives and Chinese were also allowed inside, but Spanish officials prevented them living there. The vast majority of the natives and Chinese residents lived outside the walled city.