In 1511 when the Portuguese captured Malacca they built a fortress of granite rocks taken from an area near the mouth of Sungei Batu Pahat. The remains of the fort, which they called A Famosa can still be seen in Malacca. The story goes that the town acquired its name, which means ‘Chiselled Stone’ from the quarries near the estuary, where the Portuguse used to take the stones to build their great fortress, A Famosa at Melaka after their conquest of that city. It is believed that Batu Pahat was given its name at that time. Batu means stone and pahat means chisel.
	The present township, 46 kilometers south of Muar, was not founded until 1893. Dato Bentara Luar, Mohamed Salleh bin Perang, acting on the orders of the Sultan of Johor, Maharaja Abu Bakar organised the settlement, encouraging cultivation of land for food crops. The official name of Bandar Panggaram was given to the town but it never came into common use. Today, Batu Pahat is surrounded by rubber plantations. Further towards the west coast are coconut and oil palm plantations.

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