The department of Matagalpa is the second most populated department in the country after Managua and, along with the department of Chinandega, the one with the most municipalities, with a total of 13. Matagalpa actually also administers the municipality of Waslala, which belongs to the North Caribbean Coast Autonomous Region.

The Matagalpa Department is the second largest and fifth largest national entity in the Republic of Nicaragua after Jinotega. It represents the second most populated entity, but has a lower population density due to its size.

It is one of the most productive departments in the country, and its valleys produce a wide variety of products: rice, corn, flowers, and various vegetables. It is also home to the largest concentration of coffee and livestock producers.

Some historians claim that the name derives from the Nahuatl language and means "tangled people." In pre-Columbian times, this region was inhabited by Ulúa-Matagalpa tribes, scattered throughout the territory of what is now the department.

Until the mid-18th century, the most important city in the department was Sébaco (name derived from the Nahuatl Cihuacóatl, a divinity in Mexican mythology referred to as the Serpent Woman).

Matagalpa, due to its geography, climate, elevations, natural reserves, vegetation and economic activities, causes the department to be divided into two corridors (Dry Corridor and Cool and Mountainous Corridor).

It is an Indian town found by the Spanish conquistadors at the time of the conquest of Nicaragua (Some indigenous towns with their own customs and traditions can still be preserved).