According to oral tradition, “Bayambang” came from  Pangasinan word “balangbang” or “waist”. The story went that a Spaniard  was asking  a native what the name of the place was and, without fully comprehending what was asked of him, the  latter pointed out to his waist and  responded by saying   “balangbang”. Another story states that it came from the word “kulibangbang”, a plant that grew abundantly in the area during the pre-Spanish times. Still another account suggests that it could have come from the word “bayang-bayang” which refers to the scarecrows used in driving away birds that feasted on ripening palays.

Malunguey or Balunguey”, the precursor of Bayambang , was a pre-Spanish settlement and was located west of present-day Bayambang. Spanish colonizers noted that the area was near the Agno River and its land was conducive to farming. In 1614, it became a visita of the vicariate of Binalatongan [now San Carlos City]. Five years later, it was accepted by the Provincial Chapter in 1619 as one of the vicariates of the Dominican Order under the patronage of Saint Vincent  Ferrer.

Through a Resolution, the Sangguniang Bayan of Bayambang  had recommended April 5, 1614 to the National Historical Commission of the Philippines (NHCP) as the Foundation Day of the town. The Office of the President through Proclamation No. 131 dated March 24, 2011  has officially declared such date as its Foundation Day. By April 5, 2014, Bayambang shall  celebrate its 400th year Foundation Anniversary.

Bayambang used to encompass the towns of  Alcala and  Santo Tomas, Pangasinan and those of Paniqui, Gerona and Camiling, Tarlac. However, at the close of the 19th century, the territorial boundaries of the municipality were greatly diminished when these towns were granted their respective statuses as municipalities.

The town became the 5th Capital of the short-lived Philippine Revolutionary Republic under Gen. Emilio Aguinaldo on November 12, 1899. It was also in Bautista,  then a barrio of Bayambang  where Jose Palma reportedly wrote the lyrics of the Philippine National Anthem.

Located at the central part of Southern Pangasinan along the banks of the Agno River, Bayambang is bounded on the North by the Municipality of Malasiqui, on the South by the Municipality of Camiling in the province of Tarlac, on the East by the Municipality of Bautista and on the West by the Municipality of Urbiztondo.