The full name of the municipality was created in 1999 and is meant to highlight the presence within its territory of the 5th century B.C. doric temple of Segesta, widely regarded as one of the most beautiful and intact of its type. Adjoining the temple, on a nearby hilltop, is a 2nd century Roman amphitheater.

The town was developed during the Moorish ruling in Sicily, when it was known as Kalat-al-fimi, referring to the defensive castle overlooking the town, now partially restored from ruins. One hypothesis for the castle's name derives it from "Castrum Phimes" - a stronghold protecting the territory of a Roman period nobleman mentioned by Cicero, Diocles Phimes. Another hypothesis derives it from "Castle of Euphemius," possibly referring to the 5th century Byzantine patriarch by that name (see Euphemius) or, more likely, to the 9th century Euphemius of Messina (see Euphemius (King of Sicily)) a legendary figure who was said to have brought Moorish mercenaries to Sicily in 827 to help defend his throne, only to have them conquer the island for themselves.

The economy of Calatafimi is primarily agricultural, with the most important crops being citrus, grapes and olives.

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