having been declared a historical monument by the state of rio de janeiro some years earlier, a new identity for paraty was suddenly apparent, making it the new real estate and tourism hotspot - today, paraty's population has expanded to just under 40,000, though its physical growth is limited by law for cultural and ecological reasons.

it is surrounded by the parque nacional da serra da bocaina (bocaina national park), the serra do mar state park, the environmental reserves of cairuçu and juatinga, and a plethora of islands and beaches of remarkable beauty - paraty takes its name from the tupi words 'pará' and 'ty', meaning respectively sea or river (pará) and water (ty), possibly in reference to perequê-açu, a small river the runs through the city.