In pre-European times, the area that is now São Paulo state was occupied by the Tupi people's nation, who subsisted through hunting and cultivation. The first European to settle in the area was João Ramalho, a Portuguese sailor who may have been shipwrecked around 1510, ten years after the first Portuguese landfall in Brazil. He married the daughter of a local chieftain and became a settler. In 1532, the first colonial expedition, led by Martim Afonso de Sousa of Portugal, landed at São Vicente (near the present-day port at Santos). De Sousa added Ramalho's settlement to his colony.
Early European colonisation of Brazil was very limited. Portugal was more interested in Africa and Asia. But with English and French raiding privateer ships just off the coast, the territory had to be protected. Unwilling to shoulder the burden of naval defence himself, the Portuguese ruler, King Joao III, divided the coast into "captaincies", or swathes of land, 50 leagues apart. He distributed them among well-connected Portuguese, hoping that each would be self-reliant. The early port and sugar-cultivating settlement of São Vicente was one rare success connected to this policy. In 1548, João III brought Brazil under direct royal control.
Fearing Indian attack, he discouraged development of the territory's vast interior. Some whites headed nonetheless for Piratininga, a plateau near São Vicente, drawn by its navigable rivers and agricultural potential. Borda do Campo, the plateau settlement, became an official town (Santo André da Borda do Campo) in 1553. The history of São Paulo city proper begins with the founding of a Jesuit mission of the Roman Catholic order of clergy on January 25, 1554—the anniversary of Saint Paul's conversion. The station, which is at the heart of the current city, was named São Paulo dos Campos de Piratininga (or just Pateo do Colégio). In 1560, the threat of Indian attack led many to flee from the exposed Santo André da Borda do Campo to the walled fortified Colegio. Two years later, the Colégio was besieged. Though the town survived, fighting took place sporadically for another three decades.
By 1600, the town had about 1,500 citizens and 150 households. Little was produced for export, save a number of agricultural goods. The isolation was to continue for many years, as the development of Brazil centred on the sugar plantations in the north-east.
The city's location, at the mouth of the Tietê-Paranapanema river system (which winds into the interior), made it an ideal base for another activity—enslaving expeditions. The economics were simple. Enslaved manpower for Brazil's northern sugar plantations were in short supply. Enslaved Africans were expensive, so demand for indigenous captives soared. The task was, nonetheless, hard, if not impossible, to achieve.
Among those who attempted to enslave the native were explorers of the hinterland called "bandeirantes". From their base in São Paulo, they also combed the interior in search of natural riches. Silver, gold and diamonds were companion pursuits, as well as the exploration of unknown territories. Roman Catholic missionaries sometimes tagged along, as efforts at converting the natives aborigines (Indians) worked hand in hand with Portuguese colonialism.
Despite their atrocities, the wild and hardy bandeirantes are now equally remembered for penetrating Brazil's vast interior. Trading posts established by them became permanent settlements. Interior routes opened up. Though the bandeirantes had no loyalty to the Portuguese crown, they did claim land for the king. Thus, the borders of Brazil were pushed forward to the northwest and the Amazon region and west to the Andes Mountains.
French Emperor Napoleon's invasion of Portugal in 1807 prompted the British with their vast powerful Royal Navy to evacuate King João VI of Portugal, Portugal's prince regent, from the capital Lisbon, across the Atlantic to Rio de Janeiro and Brazil then became the first overseas colony to become the temporary headquarters of the Portuguese Empire. João VI rewarded his hosts with economic reforms that would prove crucial to São Paulo's rise. Brazil's ports—long closed to non-Portuguese ships—were opened up to international trade. Restrictions on domestic manufacturing were waived.
When Napoleon was defeated in 1815, with the end of the Napoleonic Wars, João gave political shape to his territory, which soon became the United Kingdom of Portugal, Brazil and the Algarves. Portugal and Brazil, in other words, were ostensibly co-equals. Returning to Portugal six years later, João left his son, Pedro, to rule as regent and governor.
Empire of Brazil period
Pedro inherited his father's love of Brazil, resisting demands from Lisbon that Brazil should be ruled from Europe once again. Legend has it that in 1822 the regent was riding outside São Paulo when a messenger delivered a missive demanding his return to Europe, and Dom Pedro waved his sword and shouted "Independência ou morte!" (Independence or death).
João had whetted the appetite of Brazilians, who now sought a full break from the monarchy. The ever-restless Paulistas were at the vanguard of the independence movement. The small mother country of Portugal was in no position to resist—on September 7, 1822, Dom Pedro rubber-stamped Brazil's independence. He was crowned emperor shortly afterwards. The emperors ruled an independent Brazil until 1889. Over this time, the growth of liberalism in Europe had a parallel in Brazil. As the Brazilian provinces became more assertive, São Paulo was the scene of a minor (and unsuccessful) liberal revolution in 1842. When independence was declared, the city of São Paulo had just 25,000 people and 4,000 houses, but the next 60 years would see gradual growth. In 1828, the Law School, the pioneer of the city's intellectual tradition, opened. The first newspaper, O Farol Paulistano, appeared in 1827. Municipal developments such as botanical gardens, an opera house and a library, gave the city a cultural boost.
Regardless, São Paulo still faced many hurdles, especially transport. Mule-trains were the main method of transportation, and the road from the plateau down to the port of Santos was famously arduous. In the late 1860s São Paulo got its first railway line, developed by British engineers, to the Port of Santos. Other lines, such as a railway to Campinas, were soon built. This was good timing, because in the 1880s the coffee craze hit in earnest. Brazil, which had been growing it since the mid-18th century, could grow more. The Paraíba valley, which spans the states of Rio de Janeiro and São Paulo, had suitable soil and climate. São Paulo city, at the western end of the Paraíba valley, was well positioned to channel the coffee to the port of Santos.
Coffee Stock Exchange, in Santos
Meanwhile, the Brazilian monarchy had fallen in 1889. A feudalistic regime, the new republic had friends only among the sugar planters of the Northeast, whose dominance Paulistanos, among others, despised. In 1891, a new federal constitution, which delegated power to the states, was approved. The new coffee elite saw its chance. São Paulo ironed out a power-sharing understanding—known as the "café com leite" (coffee-and-milk) deal—with dairy-rich Minas Gerais, Brazil's other dominant state. Together, they held a virtual lock on federal power. Brazilian politics now became a favourite pastime of the once-rebellious Paulistanos, who sent several presidents to Rio de Janeiro—including Prudente de Morais, Brazil's first civilian president, who took office in 1894.
Plantation labour was needed—this time for coffee, not sugar. Slavery had been fading since the import of enslaved Africans was outlawed in 1850. São Paulo, thanks to such figures as Luiz Gama (a former slave), was a centre of abolitionism. In 1888, Brazil abolished slavery (it was the last country in the Americas to do so) and the freed African-Brazilians who had been helping build the nation were then forced to beg for their jobs back, working for food and shelter only because of the failure of the system to integrate them as equal citizens with Euro-Brazilians. In an effort to "bleach the race", as the nation's leaders feared Brazil was becoming a "black country", Spanish, Portuguese and Italian nationals were given incentives to become farm workers in São Paulo. The state government was so eager to bring in European immigrants that it paid for their trips and provided varying levels of subsidy.
By 1893, foreigners made up over 55 percent of São Paulo's population. Fearing oversupply, the government applied the brakes briefly in 1899; then the boom resumed. From 1908, the Japanese arrived in great numbers, many destined for the plantations on fixed-term contracts. By 1920, São Paulo was Brazil's second-largest city; a half-century before, it had been just the tenth-largest. Immigration and migration of Paulistas from other towns as well as Nordestinos and citizens from other states, the coffee industry, and modernization through the manufacturing of textiles, car and airplane parts, as well as food and technological industries, construction, fashion, and services transformed the greater São Paulo area into a thriving megalopolis and one of the world's greatest multiethnic regions.
Early 20th century
Between 1901 and 1910, coffee made up 51 percent of Brazil's total exports, far overshadowing rubber, sugar and cotton. But reliance on coffee made Brazil (and São Paulo in particular) vulnerable to poor harvests and the whims of world markets. The development of plantations in the 1890s, and widespread reliance on credit, took place against fluctuating prices and supply levels, culminating in saturation of the international market around the start of the 20th century. The government's policies of "valorisaton"—borrowing money to buy coffee and stockpiling it, in order to have a surplus during bad harvests, and meanwhile taxing coffee exports to pay off loans—seemed feasible in the short term (as did its manipulation of foreign-exchange rates to the advantage of coffee growers). But in the longer term, these actions contributed to oversupply and eventual collapse.
São Paulo's industrial development, from 1889 into the 1940s, was gradual and inward looking. Initially, industry was closely associated with agriculture: cotton plantations led to the growth of textile manufacturing. Coffee planters were among the early industrial investors.
The boom in immigration provided a market for goods, and sectors such as food processing grew. Traditional immigrant families such as the Matarazzo, Diniz, Mofarrej and Maluf became industrialists, entrepreneurs, and leading politicians.
Restrictions on imports forced by world wars and government policies of "import substitution" and trade tariffs, all contributed to industrial growth. By 1945, São Paulo had become the largest industrial centre in South America. World War I sent ripples through Brazil. Inflation was rampant. Some 50,000 workers went on strike.
The growing of the urban population grew increasingly resentful of the coffee elite. Disaffected intellectuals expressed their views during a memorable "Week of Modern Art" in 1922. Two years later, a garrison of soldiers staged a revolt (eventually quashed by government troops).
The stand-off was also political: politics had been long monopolised by the Paulista Republican Party, but in 1926 a more left-leaning party rose in opposition. In 1928, the PRP amended São Paulo's state constitution to give it more control over the city. The turbulence was mirrored on Brazil's national scene. With the Great Depression, coffee prices plunged, as did real GDP. Americans, keen investors during the 1920s, backed away.
The opening of the first highway between São Paulo and Rio in 1928 was one of the few bright spots. Into the breach stepped Getúlio Vargas, a southerner veteran in state politics. In Brazil's 1930 presidential elections, he opposed Júlio Prestes, a favourite son of São Paulo. Vargas lost the election, but with backing from Minas Gerais state—São Paulo's ever-jealous former ally and neighbor to the north—he seized power regardless.
The Constitutionalist Revolution of 1932 or Paulista War is the name given to the uprising of the population of the Brazilian state of São Paulo against the federal government of Vargas. Its main goal was to press the provisional government headed by Getúlio Vargas to enact a new Constitution, since it had revoked the previous one, adopted in 1889. However, as the movement developed and resentment against President Vargas grew deeper, it came to advocate the overthrow of the Federal Government and the secession of São Paulo from the Brazilian federation. But, it is noted that the separatist scenario was used as guerrilla tactics by the Federal Government to turn the population of the rest of the country against the state of São Paulo, broadcasting the alleged separatist notion throughout the country. There is no evidence that the movement's commanders sought separatism.
The uprising started on July 9, 1932, after five protesting students were killed by government troops on May 23, 1932. On the wake of their deaths, a movement called MMDC (from the initials of the names of each of the four students killed, Martins, Miragaia, Dráusio and Camargo) started. A fifth victim, Alvarenga, was also shot that night, but died months later.
Revolutionary troops entrenched in the battlefield. In a few months, the state of São Paulo rebelled against the federal government. Counting on the solidarity of three other powerful states, (Rio Grande do Sul, Minas Gerais and Rio de Janeiro), the politicians of São Paulo expected a quick war. However, that solidarity was never translated into actual support, and the São Paulo civil war was won by the Federation on October 2, 1932.
In spite of its military defeat, some of the movement's main demands were finally granted by Vargas afterwards: the appointment of a non-military state Governor, the election of a Constituent Assembly and, finally, the enactment of a new Constitution in 1934. However that Constitution was short lived, as in 1937, amidst growing extremism on the left and right wings of the political spectrum, Vargas closed the National Congress and enacted another Constitution, which established an authoritarian regime called Estado Novo.
Late 20th century
Vargas's rule was a study in political turbulence. Elected in 1934, he ruled by dictatorship (albeit a popular one, thanks to his health and social-welfare programmes) from 1937 to 1945—a period dubbed the "Estado Novo". Thrown out by a coup in 1945, he ran for office again in 1950, and was overwhelmingly elected. On the verge of being overthrown from office again, he committed suicide in 1954. Vargas's main legacy was the centralisation of power.
The encouragement of industry and diversification of agriculture, not to mention the abolition of subsidies on coffee, finally did away with the dominance of the coffee oligarchies. His replacement, Juscelino Kubitschek, focused on heavy industry. Kubitschek built car factories, steel plants, hydropower infrastructure and roads. Petrobras, Brazil's oil monolith, was set up in 1953. By 1958, São Paulo state controlled some 55 percent of Brazil's industrial production, up from 17 percent in 1907. Another of Kubitschek's pet projects was the creation of Brasília, which became Brazil's capital in 1960—the year Kubitschek stepped down. The University of São Paulo was founded in 1934; two years after São Paulo's failed uprising. It has established itself as the most prestigious higher learning institution in the country.
With a transitional government from military to civil and a new currency that made stagnant the economy during the mid- to late 1980s, unemployment and crime became rampant. São Paulo, by now the world's third-largest city after Mexico City and Tokyo, was hard-hit. Wealthy Brazilians retreated to suburban highly secured housing complexes such as Alphaville, and favelas, pockets of substandard living slums that lined the periphery, had a tremendous growth. For the first time in history, Brazil experienced large segments of its population immigrating to continents such as North America, Europe, Australia, and East Asia, particularly to Japan.