The town is of Arabic origin, first named Gran Zulema, from which we get the modern name. In the last years of the 700-year Reconquest, it was taken by the army of the Duke of Arcos de la Frontera in 1485. This small town experienced a huge industrial and economic boom in the 17th century (at one point acquiring the nickname ‘Cádiz el Chico’, ‘little Cádiz’) thanks largely to its textile trade, which produces even today, with the wool trade in decline, the famous Grazalema blankets. It is also alleged to be the rainiest place in Spain, due to its altitude and position between Atlantic and Mediterranean weather systems (the rain gauge for Grazalema averages 2.132 mm over the year). Certainly, no one ever went bust selling umbrellas in Grazalema.
Excavations around Grazalema and its environs have produced archeological evidence of human settlement and activity since prehistory, possibly the same Paleolithic culture that left cave art at the nearby Pileta cave system at Benaoján. Undoubtedly, and given the evidence of these vestiges of earlier cultures, the early history of the region dates back to and beyond the Roman colonization of the Mediterranean basin.
With the legions of the Roman general Scipio, defeater of Hannibal, came the building of the 2nd century Roman villa of Lacilbula on the hillside at the Cortijo de Clavijo, just outside Grazalema. The name of the river here, the Guadalete, has been linked to the river Cilbus, referred to by Roman historians, and the villa, of which only vestiges remain, was likely part of a fortified settlement.