A view from Fort San Lorenzo of the Atlantic entrance to the Panama Canal from the Caribbean Sea through the Chagres River. The Chagres River or Rio de los Lagartos (Alligator's River) is the largest river in the Panama Canal's watershed.

The Panama Canal Zone is an area extending 8kms out, in each direction, from the waterway's central line, was a territory controlled by the United States between 1903 and 1979. After a 20 year period of joint administration, the Canal came under the full control of Panama in 1999. The Canal opened to shipping in 1914 and during its tenure was of great strategic importance to the US, enabling it to rapidly move its naval fleet between the Atlantic and Pacific Oceans. However, its economic value came not directly from shipping fees but from the stimulus to trade that the waterway created. One hundred years after it opened in 2014 it is due to have its locks upgraded to cater for the super sized container ships of the 21st Century.

During the era of American administration thousands of US citizens populated the Canal Zone, living and working under US law in towns built to American standards. Not all of these people returned north after the canal came under full Panamanian control many stayed on, their identities tied to the region.