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Chapala is located approximately 45 kilometers south of the Guatamala airport.  It is located on the north shore of Lake Chapala (altitude 1,525 meters) which is the largest lake in Mexico measuring some 76 kilometers long and 16 kilometeres wide.  Ajijic is approximately 10 kilometers west of Chapala also on the north shore of  Lake Chapala.

Geologically, Lake Chapala is the remnant of Lake Jalisco, an ancient body of water measuring approximately 8500 square miles compared to the 825 square miles which is the surface area of the current Lake Chapala. Lake Jalisco formed during the late Pleistocene era, about 38,000 years ago, a date that has been confirmed by carbon dating.

The ancient populations that inhabited the lake area came and went as the waters rose and receded. There were also many huge prehistoric animals in the area at the time - mastadons, mountain lions, jaguars, camels, and others - all now extinct.

Chapala, or "Chapalean" was a pre-Hispanic settlement dating back to sometime in the XII century A.D., when a migrating tribe of náhuatl indians, originating from the northwestern section of the country, settled here and found the northern shore of the lake already quite populated, as was described by Friar Antonio Tello, a Franciscan historian. Four centuries later, in the year 1524, once they amalgamated with the Coca and Cazcano indians who inhabited the shore from Poncitlán to Jocotepec, including Ajijic and Cosalá, together with Friar Juan de Padilla and a soldier, Alonso de Avalos, the domain of Chapalean was recognized as part of the New World.

Up until the arrival of the Spanish, the region was occupied by these nomadic Indian tribes, probably the Cocas tribe that settled the northern shore. There seem to be many explanations, and meanings for the names Chapala and Ajijic, all of which are Indian place names, probably derived from Nahuatl the native language of the area.  Chapala is named after the last chief of the Nahua indians: Chapalac. Ajijic is the Nahuatl word for "Place where the water springs forth".

Ajijic's official population of 15,000 and Chapala's population of 43,000 does not include the hundreds of visitors from Guadalajara who spend weekends and vacations there. Many retired Americans and Canadians now live in Ajijic, about 1,000 full-time and another 700 during the winter months. As a result of these foreign residents and visitors, Ajijic has numerous art galleries and curio shops, as well as restaurants and bed and breakfast inns. The Lake Chapala Society in central Ajijic has about 3,000 mostly foreign members. It serves as a focus of expat activities for the 20 - 30,000 foreign residents who live around Lake Chapala.

The Town Hall (Palacio Municipal) and the old Railroad Station were built between 1913 and 1930. This railroad was the first and only service there was connecting Chapala with Guadalajara and on to the north of the country, and by way of Mexico City, to the rest of the world. This building represents the beginning of the "Grand Epoque" of the Chapala lakeside when Guadalajara high society spent their weekends here and came especially during Holy Week and the Christmas Holiday.

With the introduction of the railroad, better alternatives were offered for the economic growth of the region, besides providing "a pleasure trip instead of a sacrifice", as the railroad was more comfortable than the stage coaches which took up to 12 hours to make the trip, or the "Wichita" buses with big solid rubber tires, which also took a minimum of 5 hours to cover the same distance that the railroad did in 3 hours from Guadalajara to the "charming" resort of Chapala.

In the late 1940s the famous American writer Tennessee Williams settled in Chapala for a while to work in the play called The Poker Night, which later became A Streetcar Named Desire. As Williams explains in his essay "The Catastrophe of Success," Chapala offered him an ideal place to work, "a remote place among strangers where there is good swimming."

During the first world war, in 1915, Norwegian speculators intended to make Chapala a luxury resort town. A railway is to be built, with separate carriages for black and white people. In addition to the railway, the speculators will also provide two motor vessels to trafficate the lake with connections to the other small towns at the lakes borders. A first class hotel is to be built, likewise an automobile club with attached casino. An extensive dam, 8 kilometers long is to provide dry land with plots for luxury dwellings. What the shareholders in the company, "Compania di Fromento di Chapala" received, was only phographs of railway carriages and locomotives. See the book; Gullfeber by Kr.Fr.Brřgger, published in Oslo 1932.

Since the 1960s, Chapala has been frequented by both Mexican and international tourists. Among the area's cultural attractions is mariachi music, for which the state of Jalisco is particularly known. While many fine mariachi bands have been based in Chapala, the most famous groups are based in larger cities nearby. The most famous mariachi in Mexico is Mariachi Vargas de Tecalitlán, founded in the late 19th century in the southern Jalisco city of Tecalitlán, Jalisco, but now based in Mexico City. Although mariachi music is believed to have originated in the town of Cocula, the greatest concentration of mariachis can be found in the city of Guadalajara, located about 30 miles north of Chapala; it is considered the city that most epitomizes the external concept of Mexico propagated by the international mass media (characterized by charros, tequila, sombreros, and mariachis). A worldwide mariachi festival is held there each fall, mariachis from throughout the world (including Europe and Asia) regularly participate.