The settling of Madeira started in 1425. After its discovery, in 1419, the island was divided in two captaincies, being in charge of Funchal, João Gonçalves Zarco, where he resided with his family. The primitive little village, located on a gorgeous valley of natural trees, full of fennel till the sea, as the first chroniclers refer, was given the name of Funchal, rapidly  becoming the core population center of the Island. The best port and the mild weather together with an excellent  geographic position on the south coast - The most productive in the Island - allowed Funchal a rapid and blazing urban development, surpassing quickly the rest of the populations that  gravitated around it.
Between 1452 and 1454, still in the reign of Infante D. Henriques, Funchal had its first charter, wich elevated it to the category of Village. After 1480 it started to have a representation of the "mesteres" on the city council. Funchal became a center with an obligatory passage of the Portuguese trade routes back then, to where was transfered the big European commercial interests. Adventurers and traders from the most hidden origins, here resided in search of better conditions of life and work, as it was the case of Cristóvão Colombo of Génova, of its friend João d’Esmenaut of Picardia, of Lomelino de Génova, of Acciauoli of Florença, of the Bettencourt of French history, among others.
In the end of the XV century, D. Manuel Duke of Beja, that had control of the Order Of Christ, encouraged the planning and structuring of the  prosperous and progressive village. So, he ordered  the construction of the City Council and of the Notaries, which would be ready in 1491, built a new church that was raised soon after to the category of Cathedral in 1514 and almost at the same time ordered the construction of a new hospital.
In the start of the XVI century, more precisely in 1508, Funchal is elevated to the category of city, a few years later to the Bishopric Headquarters and after the construction of the dioceses of Angra, Cabo Verde, São Tomé and Goa, to the category of Archbishop.
The city developed by a long street riverside that over the course of history, knew many names, as Santa Maria, Caixeiros, Alfândega e Mercadores. From that street others were born, skirting the three streams that crossed the broad Valley and headed to the mountains.