DAMAUN or Daman, a town of Portuguese India, capital of the settlement of Damaun, situated on the east side of the entrance of the Gulf of Cambay within the Bombay Presidency. The area of the settlement is 82 sq. m. Pop. (1900) 41,671. The settlement is divided into two parts, Damaun proper, and the larger pargana of Nagar Havili, the two being separated by a narrow strip of British territory. The soil is fertile, and rice, wheat and tobacco are the chief crops. The teak forests are valuable. Weaving is an industry less important than formerly; mats and baskets are manufactured, and deep-sea fishing is an important industry. The shipbuilding business at the town of Damaun is important. Early in the 19th century a large transit trade in opium between Karachi and China was carried on at Damaun, but it ceased in 1837, when the British prohibited it after their conquest of Sind. The settlement is administered as a unit, and has a municipal chamber.
Damaun town was sacked and burnt by the Portuguese in 1531. It was subsequently rebuilt, and in 1558 was again taken by the Portuguese, who made a permanent settlement and converted the mosque into a Christian church. From that time it has remained in their hands. The territory of Damaun proper was conquered by the Portuguese in 1559; that of Nagar Havili was ceded to them by the Mahrattas in 1780 in indemnification for piracy.