The history of Cox's Bazar begins in the Mughal period. On his way to Arakan, when the Mughal Prince Shah Shuja passed through the hilly terrain of the present day Cox’s Bazar, he was attracted to the scenic and captivating beauty of the region. He commanded his forces to camp there. A place named Dulahazara, meaning "one thousand palanquins", still exists in the area. After the Mughals, the place came under the control of the Tipras and the Arakanese, followed by the Portuguese and then the British. The name Cox's Bazar/Bazaar derived from the name of Captain James Cox of the East India, who was in charge of the naval base during 1800 AD, even though he died in 1798 as noted above in this very article. In 1854, Cox's Bazar was made a subdivisional headquarters.
After the end of British rule, Cox's Bazar remained part of East Pakistan. Captain Advocate Fazlul Karim, the first Chairman (after independence from the British) of Cox's Bazar municipality established the Tamarisk Forest along the beach to draw tourism to the town and also to protect the beach from tide. He also donated many of his father in law's (Akbar Ahmed Chowdhury, son of Fazlul Karim Kwik of Manikpur) and his own lands for establishing a Public Library and Town Hall. In 1971, the wharf was used as a naval port by the Pakistan Navy's gunboats. This and the nearby airstrip of the Pakistan Air Force were the scene of intense shelling by the Indian Navy during the Bangladesh Liberation War.
In 1984 Cox's Bazar was made a District
.
