Paracatu has its origins in the beginning of the eighteenth century, with the discovery of gold. For many years gold was abundant in alluvial deposits.
The town began before 1730. On 24 June 1744 the news of the discovery of the mines of Paracatu reached the government of the Capitania of Minas and the town began to prosper.
On 20 October 1796, the Vila de Paracatu do Príncipe was created, with a document signed by Maria I, Queen of Portugal. In 1840 the Vila raised to the category of town. Decline set in with the exhaustion of the gold fields, but with the building of Brasília in the 1960s and the construction of a highway linking Belo Horizonte and the new capital, Paracatu began to grow again.
Its population in 2010 was 84,718 inhabitants (IBGE census). Its area is of 8 229,588 km². The origin of the name comes from the Tupi language, "para" = river (in Portuguese, rio) and "catu" = beautiful (in Portuguese, bonito).