Recent history of Caye Caulker began when Mestizo refugees from the Mexican Caste Wars arrived. The area that became the village on Caye Caulker was formally purchased by Luciano Reyes around 1870. Lots were sold to other families, most of which still have descendants on the island today. The influence of these families is still very apparent.

As for the name, there are several theories on how Caye Caulker got it. Caye Caulker was known earlier on by its Spanish name, Cayo Hicaco, meaning “island of the cocoplum”. This name may have eventually evolved to what it is today.

Some maps had the island’s name spelled “Cay Corker”, possibly because of its reputation for having a plentiful supply of fresh water. It was likely a good spot for sailors or “pirates” to refill and cork water bottles, another possibility of how the island may have gotten its name.

The island was also known for its boat-building in the earlier days (talented and skilled shipwrights still design and construct boats today). In the protected bay on the west side of the island, the wooden boats were caulked in order to make them watertight. This practice, or a combination of the theories above, may have lead to the name “Caye Caulker”.

Fishing, including lobster fishing, has been a longtime source of income for the island. While this is still the case, the island’s economy is based more and more upon the growing tourism industry.