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Leyte is one of the oldest poblacions within the province. According to Manuel Artigas y Cuerva, "Hiraite" was under the jurisdiction of Carigara with Barugo and Samputan.

There are several versions as to how the place got its name. One of these relates that according to tradition, toward the west of the present town of Carigara, was a village ruled by Datu Ete. When the Augustinian Fathers heard of the region, they went to the place in order to Christianize the natives. They sailed by boat towards a small bay that swelled into a big river. Disembarking at a small village near the bank of the river, the friars asked the natives for direction. The natives, not knowing the language, answered, "Hira Ete" - which means, "the place belonged to Ete." The friars thought the natives meant that the name of the place was called Hiraete, hence their communications with their superiors referred to the place as Hiraite.

Another version given by Justice Norberto Romualdez Sr., accidentally confirms the story of the origin of the name of Leyte. He said that the name "Leyte" came from two Visayan words: "Hirayte" or "Hiraite." "Hi" is a Visayan article, which normally precedes a proper name. Its plural form is "Hira." "Raite" is a proper name of a person. "Hi Raite" then means a person called Raite. Or, we take the plural form, "hira Ete" which means "Ete's men" or "Ete's company."

Still another version tells the story of a brave datu named "Kandos" who ruled a peaceful village along the southern bank of Taberna River, opposite the site of the present town of Leyte. His beautiful wife was named Hiraite. Because of his intense love for his wife and in order to perpetuate her name among his subjects, he named his barangay "Hiraite." Datu Kandos ruled wisely and justly but because of several misfortunes and calamities, many of his subjects died of hunger. To forestall further suffering, he moved the site of his village to the seacoast so they could live on the products of the sea. That place at present is called "Rawis."

For almost two centuries, the town of Leyte was known as Hiraite. It was much later when the name was transformed to its present form: Leyte.

In the "Historia de Filipinas" by Father Delgado, the place was said to be already known to the sailors of Ferdianand Magellan. "Hiraite" was referred to in the records of the discoverer as a pueblo, which rested on the banks of a river. It was a very old but small village, according to the account. The ships of Magellan docked on the bay at the center of what is now the town proper to pass the night.

In 1851, the town was finally separated from the mother municipality. Previous to this event however, Hiraite was already an established parish.

When the Jesuits took over the work of the Augustinians in 1595, many of the natives had already been converted to Christianity. The Jesuits constructed a spacious church in 1768 to accommodate the growing parish. A wooden convent was also built at the right side of the church.

In his "Relacion de las Islas Filipinos, Father Pedro Chirino, S.J. relates the eagerness of the natives to be converted. He narrates that during the Holy Week of 1596, he went with a companion to Hiraite. They were forced to land at the seashore owing to the bad weather and had to proceed to the village on foot. "It was quite providential," he said, as they met a very old woman that was apparently very sick, while passing one of the plantations. The woman decided to be baptized. The following day, the woman died a sudden but peaceful death.

They made Our Lady of the Immaculate Conception as the Patron saint of Leyte, Leyte who is still venerated and honored up to the present.

Leyte was also a victim of Moro depredations just like most coastal towns. Even if the town was protected by Spanish artillery, it was burned completely by the pirates when a heavy downpour made the Castillian guns useless. The pirates entered the town and looted the houses. They captured inhabitants, many of them women, who were unable to evacuate.

The death of a moro leader in a skirmish angered the pirates. They put the entire town on fire and captured an Agustinian friar, Father Miguel Perpinan, whom they carried off to Mindanao. Soon after this calamity, the friars abandoned the town temporarily.

When the Jesuits returned in 1595, however, the natives were encouraged to return and rebuild their homes.

For two centuries the town grew and prospered. During the American regime, the fanatical "pulahanes" entered the town. They killed the natives of the pueblo whom they believed were friends of the Americans. In 1897, they visited the town for a second time. However, they did not do any damage but contented themselves with confiscating some boats, which they used to cross over to Biliran Island.

Leyte is blessed with an abundance of wood that is used in shipbuilding. During the American regime, the people devoted their energies towards the boat building, which they used to navigate on the coasts of Leyte from Carigara to Tacloban. The town has a good wharf and its rivers are deep and navigable.