The original colony was in the city of Jacagua, which was founded in 1495, but when it was destroyed by an earthquake, it was moved to its present location in 1506. It was devastated by another earthquake in 1562. Santiago de los Caballeros has at times been the capital of the country, and was an important strategic city in the Dominican War of Independence in 1844.
The name of the city, Saint James of the Knights, makes allusion to the Hidalgos de la Isabela, a group of knights who had come from La Isabela city to stay in Santiago. That they were actual knights is clear from the fact that when they got back to Spain they put a formal complaint before the king stating that their horses had been unfairly commissioned as beasts of burden and their weapons had been appropriated by the Columbus brothers (Diego and Bartolome) and that they had been made to do manual labor, something considered beneath their station as knights, who were meant to engage only in battle. The king compensated them for all their losses. Sometimes the city is even called Santiago de los 30 Caballeros