Commonly known as the Canal Museum, this institution is located in Panama City's historic San Felipe neighborhood. Housed in a restored 1874 building at Plaza de la Independencia.

The Museum was conceived in 1996, when the Board of Trustees that oversees its activities was approved and it was decided to rehabilitate the building that houses it, which dates back to 1874. It was inaugurated on September 9, 1997, on the occasion of the World Canal Congress.

Many national and international institutions have supported the Museum since its creation, including the former Panama Canal Commission and the European Community. It is currently an active member of the International Council of Museums (ICOM) and the American Association of Museums (AAM). It is also affiliated with the Smithsonian Institution. The museum has ten permanent exhibition halls that chronologically present the history of the interoceanic route through the isthmus and the subsequent construction of the Panama Canal. It also presents the evolution of the Canal's activities and the transfer of the Canal into Panamanian hands through the fulfillment of the Torrijos-Carter treaties.