Lagoa receives its name from the fact that the area is fairly flat and suspectible to ocean swells, the area of Lagoa was regularly flooded by ocean waves during winter storms until the new sea coastal defence system was built. The largest of the localities within Paul do Mar is Espanha. It is located in the centre of the parish, occupying an important centre of activities, including the locations of the health centre and main primary school, in addition to the municipal football field.
