Ilaro was founded in the 18th century by Aro who migrated from the Oyo town to settle down in Igbo Aje, a little hill situated at the centre of the town from where he and his warriors could sight enemies (mostly slave traders from the neighbouring Benin republic known then as Dahomey) on attack from a long distance. Aro himself was a warrior and a hunter to be reckoned with. Ilaro had her name from "Ilu Aro" meaning the settlement of Aro which later became Ilaro for ease of pronunciation. Ancient Ilaro town was blessed with great farmers, hunters and warriors out of which Orona and Osata ranked the files of Ilaro history.

Social amenities in Ilaro town include: government-owned and privately owned hospitals, government-owned dispensaries, public libraries, electrical plants, water works and road networks linking the town with other towns and even neighbouring country, Republic of Benin. There are quite a number of hotels of quality spread over the town. In January, 2009, Governor Gbenga Daniel commissioned the Ilaro International stadium. The stadium is capable of hosting international and national sports competitions


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