The prehistory of Papua New Guinea can be traced to about 50,000–60,000 years ago, when people first migrated towards the Australian continent. Agriculture was established at least 7000 years ago in the New Guinea Highlands. Extensive trade networks operated throughout the region, and successive waves of migration included the spread of Austronesian languages around 3000 years ago, and the rise of the Lapita culture.

In 1545 the Spanish explorer Yñigo Ortiz de Retez was the first person to give the name "New Guinea" to the main island. European colonisation began in the 1880s when the eastern portion of New Guinea was divided between the German Empire and the British Empire. In WWI, the Allies took control of German New Guinea. After the war ended, the League of Nations gave Australia a mandate to administer the former German territory. In 1949, an Act was passed by the Parliament of Australia to form the administrative union of the Territory of Papua and New Guinea. On 16 September 1975, the Territory gained independence from Australia and became a sovereign state known as the Independent State of Papua New Guinea.

Archaeology

Archaeological evidence indicates that humans arrived on New Guinea perhaps 60,000 years ago, although this is under debate. They came probably by sea from Southeast Asia during the Last Glacial Period, when sea levels were lower. Although the first arrivals were hunters and gatherers, early evidence shows that people managed the forest environment to provide food. There also are indications of Neolithic gardening having been practiced at Kuk at the same time that agriculture was developing in Mesopotamia and Egypt. The sweet potatoes and pigs which are agricultural staples today were later arrivals, but shellfish and fish have long been mainstays of coastal dwellers' diets. Recent archaeological research suggests that 50,000 years ago people may have occupied sites in the highlands at altitudes of up to , rather than being restricted to warmer coastal areas.

Archaeological evidence indicates that anatomically modern humans first arrived in what became New Guinea and Australia, as well as the Bismarck Archipelago, around 42,000 to 45,000 years ago. Bougainville was settled around 28,000 years ago, and the more distant Manus Island by 20,000 years ago. These migrations were part of one of the earliest migrations of humans from Africa, and resulting populations remained relatively isolated from the rest of the world throughout prehistory. Evidence of habitation of the highlands goes back 35,000 years. The climate warmed from around 18,000 years ago, and rising sea levels isolated New Guinea from Australia about 10,000 years ago. However, Aboriginal Australians and New Guineans diverged from each other genetically earlier, about 37,000 years ago. Habitation of the islands increased after the climate changed. Water rose over the Torres Strait around 8,500 years ago. The Bismarck and Solomon archipelagos were never connected to Sahul. The people of New Guinea share 4%–7% of their genome with the Denisovans, indicating that the ancestors of Papuans interbred in Asia with these archaic hominins.

Stone tools have been found on the Huon Peninsula dating back 40,000 years. Before proper agriculture, some plants had already been domesticated, including sago, Canarium indicum, and karuka. C. indicum was possibly spread by people from the mainland to the islands. Karuka may have originally been domesticated Pandanus brosimos. Taro was eaten long before it was purposefully farmed. Obsidian tools, which could be used for harvesting plants, were traded from at least 23,000 years ago. At some point, cassowary chicks began to be occasionally reared.

Agriculture was independently developed in the New Guinea highlands around 7000 BC, making it one of the few areas in the world where people independently domesticated plants.Diamond, J. (March 1997). Guns, Germs, and Steel: The Fates of Human Societies. W.W. Norton & Company. . Significant evidence of this comes from the Kuk Swamp, which has evidence of thousands of years of use to grow crops including taro and bananas.

Archaeological evidence shows that Austronesian-speaking peoples of the Lapita culture reached the Bismarck Archipelago by 3,300 years ago. It is unknown whether they also settled on the mainland at this time, however there is strong evidence of their presence in coastal areas from around 500 BC. These communities interacted with larger trade networks. It is likely through these trading networks that banana and sugarcane moved from New Guinea to other areas of the world. Austronesian migration has been correlated with the introduction of pottery, pigs, chickens, dogs, and certain fishing techniques. Two plant species came from the Pacific: Barringtonia procera likely arrived from the Solomon Islands, while Kava came from Vanuatu.

Trade reduced by around 300 AD, as demand for goods shifted to the Maluku Islands and Timor. After European interest in the region grew in the 16th century, Dutch influence grew over the Sultanate of Tidore. This Sultanate had some influence over islands near New Guinea. Over the centuries, Dutch authorities extended the area they claimed was part of this Sultanate to roughly the current Indonesia–Papua New Guinea border, however limited or nonexistent the Sultan's actual control was. Renewed trade began to spread to the Eastern parts of New Guinea in the late 17th century, driven by demand for goods including dammar gum, sea cucumbers, pearls, copra, shells, and bird-of-paradise feathers.

Although by the late 20th century headhunting and cannibalism had been practically eradicated, in the past they were practised in many parts of the country as part of rituals related to warfare and taking in enemy spirits or powers.Knauft, Bruce M. (1999) From Primitive to Postcolonial in Melanesia and Anthropology . University of Michigan Press. p. 103. "Cannibalism Normal For Early Humans? ." National Geographic News. 10 April 2003. In 1901, on Goaribari Island in the Gulf of Papua, missionary Harry Dauncey found 10,000 skulls in the island's long houses, a demonstration of past practices.Goldman, Laurence (1999).The Anthropology of Cannibalism. Greenwood Publishing Group. p. 19. According to Marianna Torgovnick, writing in 1991, "The most fully documented instances of cannibalism as a social institution come from New Guinea, where head-hunting and ritual cannibalism survived, in certain isolated areas, into the Fifties, Sixties, and Seventies, and still leave traces within certain social groups."Torgovnick, Marianna (1991). Gone Primitive: Savage Intellects, Modern Lives, University of Chicago Press. p. 258

On New Guinea, communities were economically linked through trading networks, however aside from some political alliances each community functioned largely independently, relying on subsistence agriculture. Goods were often traded along established chains, and some villagers would be familiar with and sometimes know the languages of the immediately neighbouring villages (although language by itself was not a marker of political allegiance). Some wider trading networks existed in maritime areas, such as the Kula ring. Other well known trade networks include the Schouten Islands and the mainland, trade across the Vitiaz Strait, and the Hiri trade cycle. While people did not move far along these routes, goods moved long distances through local exchanges, and cultural practices likely diffused along them. Despite these links, the creation of larger political entities under European rule had no precedent, and in many cases brought together communities who had historically antagonistic relationships, or no relationship at all.

European contact

It is likely that some ships from China and Southeast Asia visited the island at times, and that there was some contact with New Guinean communities. The Portuguese explorer António de Abreu was the first European to discover the island of New Guinea, encountering the north coast, and in 1526 his countryman Jorge de Menezes discovered the west coast. The first Spanish explorer to see the island was Álvaro de Saavedra Cerón in 1528. Portuguese traders introduced the South American sweet potato to the Moluccas. From there, it likely spread into what is today Papua New Guinea sometime in the 17th or 18th century, initially from the southern coast. It soon spread inland to the highlands, and became a staple food. The introduction of the sweet potato, possibly alongside other agricultural changes, transformed traditional agriculture and societies and likely led to the spread of the Big man social structure. Sweet potato largely supplanted the previous staple, taro, and resulted in a significant increase in population in the highlands. They allowed for cultivation at higher altitudes, and for a larger number of pigs to be raised. The date of the sweet potato's arrival is still disputed. It did not spread to all communities, with some still relying on taro and yam. Also from the Americas, Tobacco was similarly introduced around this time, with the first written evidence showing it was present in 1616. Lima beans were likely introduced in the 1700s or 1800s. Bixa orellana followed some time before 1870. In total, over 170 native and introduced plant species are known to have been used for food in some way before permanent European contact, with the core plants being taro, banana, sago, and yam.

When Europeans first arrived, inhabitants of New Guinea and nearby islands, whose technologies included bone, wood, and stone tools, had a productive agricultural system. They traded along the coast (mainly in pottery, shell ornaments and foodstuffs) and in the interior (exchanging forest products for shells and other sea products).

The first known Europeans to sight New Guinea were probably Portuguese and Spanish navigators sailing in the South Pacific in the early part of the 16th century. In 1526–1527 the Portuguese explorer Jorge de Menezes accidentally came upon the principal island.

Papua is derived from a local term of uncertain origin, that may have already been used locally to refer to at least parts of the island now called New Guinea. In 1526 Portuguese explorer Jorge de Menezes named the island . The word "Papua" has applied to various areas of New Guinea since then, with its inclusion in "Papua New Guinea" coming from its use for the Territory of Papua.

Papua may be from a Malay word for the frizzled quality of Melanesian people's hair.

Regarding the islands of New Guinea, the Portuguese captain and geographer António Galvão wrote that:

"New Guinea" (Nueva Guinea) was the name coined by the Spanish explorer Yñigo Ortiz de Retez. In 1545, he noted the resemblance of the people to those he had earlier seen along the Guinea coast of Africa. Guinea, in its turn, is etymologically derived from the Portuguese word Guiné. The name is one of several toponyms sharing similar etymologies, which likely means "of the burnt face" or similar, in reference to the dark skin of the inhabitants. Its use in the country name comes from German New Guinea, later the Territory of New Guinea, which was united with the territory of Papua.

Although European navigators visited the islands and explored their coastlines thereafter, European researchers knew little of the inhabitants until the 1870s, when Russian anthropologist Nicholai Miklukho-Maklai made a number of expeditions to New Guinea, spent several years living among native tribes, and described their way of life in a comprehensive treatise.