Mozambique's first inhabitants were San hunter and gatherers, ancestors of the Khoisani peoples. Between the first and fourth centuries AD, waves of Bantu-speaking peoples migrated from the north through the Zambezi River valley and then gradually into the plateau and coastal areas. The Bantu were farmers and ironworkers.

When Portuguese explorers reached Mozambique in 1498, Arab-trading settlements had existed along the coast and outlying islands for several centuries. From about 1500, Portuguese trading posts and forts became regular ports of call on the new route to the east. Later, traders and prospectors penetrated the interior regions seeking gold and slaves. Although Portuguese influence gradually expanded, its power was limited and exercised through individual settlers who were granted extensive autonomy. As a result, investment lagged while Lisbon devoted itself to the more lucrative trade with India and the Far East and to the colonization of Brazil.

By the early 20th century the Portuguese had shifted the administration of much of the country to large private companies, controlled and financed mostly by the British, which established railroad lines to neighboring countries and supplied cheap--often forced--African labor to the mines and plantations of the nearby British colonies and South Africa. Because policies were designed to benefit white settlers and the Portuguese homeland, little attention was paid to Mozambique's national integration, its economic infrastructure, or the skills of its population.

After World War II, while many European nations were granting independence to their colonies, Portugal clung to the concept that Mozambique and other Portuguese possessions were overseas provinces of the mother country, and emigration to the colonies soared. Mozambique's Portuguese population at the time of independence was about 250,000. The drive for Mozambican independence developed apace, and in 1962 several anti-colonial political groups formed the Front for the Liberation of Mozambique (FRELIMO), which initiated an armed campaign against Portuguese colonial rule in September 1964. After 10 years of sporadic warfare and major political changes in Portugal, Mozambique became independent on June 25, 1975. FRELIMO quickly established a one-party Marxist state and outlawed rival political activity.