The name Piña Colada literally means strained pineapple, a reference to the freshly pressed and strained pineapple juice used in the drink's preparation.

Three Puerto Rican bartenders contest the ownership of their national drink. Ramón 'Monchito' Marrero Pérez claims to have first made it at the Caribe Hilton Hotel's Beachcomber Bar in San Juan on 15 August 1952, using the then newly-available Coco López cream of coconut. Coco López was developed in Puerto Rico in 1948 by Don Ramón López-Irizarry, hence the Puerto Rican connection and the 1952 account of the drink's creation. Some say the drink did not acquire its name until the 1960s.

Ricardo García, who also worked at the Caribe, says that it was he who invented the drink, while Ramón Portas Mingot says he created it in 1963 at the Barrachina Restaurant, 104 Fortaleza Street, Old San Juan. The restaurant stands by his claim to this day.

The Caribe Hilton Hotel sits on a 17-acre peninsula outside San Juan and was the first luxury hotel to open in the region, becoming a popular destination for the rich and famous who helped spread word of the drink.