The name Brazil is a shortened from of Terra do Brasil, land of Brazil, a reference to brazilwood, given in the early 16th century to the territories leased to the merchant consortium led by Fernão de Loronha for commercial exploitation of brazilwood for the production of wood dyes for the European textile industry.

The term for the brazilwood tree in Portuguese, pau-brasil, is derived from brasa (ember), a reference to the colour, formed from medieval Latin brasa, from Old French brese, "ember, glowing charcoal", in turn from a West Germanic *brasa).