The name "Varadero" appears for the first time in the official reports of the Captain General of the island in 1555, however, the first families began to settle in the peninsula around 1880 and it was not until 1887 that the villa was officially founded. It owes its name (a "varadero" is a shallow zone near the shore) to the extended sand banks where the ships used to strand.

The first constructions of Varadero were summerhouses of the wealthy families of the zone: beautiful two-story wooden chalets, notably influenced by American southern architecture. Later in time, from the 1920's on, the first real estate companies began to appear together with the spectacular residences built for the Cuban bourgeoisie and some foreign magnates.

One of the most luxurious residences of the peninsula is the mansion "Xanadu", built for the multimillionaire Irene Dupont, king of the American chemical industry, on top of the highest hill of Varadero. The construction, finished in 1929, was projected with all the possible luxury because the only demand made by the future owner was to spend as much as needed. Nowadays, the mansion is opened to the public as a gourmet restaurant specialized in French cuisine and wines and is also the house of the 18-hole Varadero International Golf Club.

Another awesome residence of Varadero is the "Retiro de Josone", inaugurated in 1942 by its owner José Uturrio, the manager of the rum company "Rones Arechabala". From the very moment of the end of its construction, it became one of the most coveted properties of the peninsula. Designed with a refined style, great importance was given to open spaces and the beauty of tropical nature in the area. A large perimeter wall hides this sort of botanical garden with artificial lagoons and keeps it away from the outside world. Today, it is also open to the public with the name "Parque Retiro de Josone" and offers, besides its natural attractions, the service of three renowned restaurants: "El Retiro", "La Campana", and "Antiguedades".

In the 1950's, the "Hotel Internacional" was built, dividing Varadero into the old section and the modern one with more luxury and natural attractions. This hotel, highly influenced by the Miami architecture of the time and equipped with a large casino and a cabaret, was the favorite of American tourism and the most important of Varadero until the first years of the 1960's.