The history of Bagamoyo dates back to the 8th century, when Arabs and Shirazis from the Persian Gulf settled a town named Kaole, the ruins of which can be seen just outside Bagamoyo. The name of Bagamoyo comes from the Swahili word 'Bwagamoyo', which means 'lay down your heart', a reminder that it used to be a shipping place for slaves.

Bagamoyo itself was founded in the 18th century. During the German colonial period, Bagamoyo became the administrative center of the area and capital of Tanzania. Numerous buildings from the colonial still stand in the city center, although they are in a severe state of dilapidation.

There is little accommodation in Bagamoyo. The city has bus connections with Dar es Salaam, 75 km (47 mi) to the southeast. Bagamoyo is located on the Zanzibar Channel, across from the island of Zanzibar.

Warning: Be very careful in Bagamoyo, as bandits armed with pangas (cane cutting knives) roam the town. Even if you don't resist them, they won't hesitate to use the knives. Don't expect any help from the police.