Managua, with a population of about 1,617,096 in 2004, is the capital of Nicaragua and largest city of Central America. Situated on the southern shore of Lake Managua, the city was made the national capital in 1855; previously the capital had alternated between the cities of León and Granada. Managua is overwhelmingly populated by Spanish-speaking Mestizo and white Nicaraguans. There are also Syrian, Palestinian, and Armenian communities and other Middle Easterners as well. Asians — entirely Japanese and Chinese (both mainlanders and Taiwanese — are also a thriving economic force; they are responsible for many of the hotels and new centers of the "New Managua," they are heavily dedicated to entrepeunerial activity.

Managua was damaged by earthquake and fire on March 31, 1931 and by fire again in 1936. On December 23, 1972, the city was very severely damaged in an earthquake that took more than 10,000 lives. In the aftermath, when international help came in to rebuild the town, the dictator Somoza and his troops allegedly took the donations and either hid them from the public or used the donations for themselves. As a result, the downtown area, devastated by the earthquake, was never rebuilt, and it remains half-empty even today. Those actions were a contributing factor to the Sandinistas' takeover of Nicaragua in 1979.

In 1998 Managua was damaged by a hurricane.

The main international airport that serves Managua is Augusto C. Sandino International Airport.

Managua is also the birthplace of Nicaraguan Sign Language, where the Sandinistas gathered deaf children who never learned to speak, but who could communicate clumsily with parents and family members using gestures, and put them together in an effort at "socialistic" education. The children then proceeded to communicate among themselves, and, in doing so, invented one of the world's newest languages.