Banda Islands, a group of the Dutch East Indies, consisting of three chief and several lesser islands in the Banda Sea, south of Ceram, belonging to the residency of Amboyna. The main islands are Great Banda or Lontor; Banda Neira to its north; Gunong Api, west of Banda Neira; Wai or Ai still farther west, with Run on its south-west; Pisang, north of Gunong Api; and Suwangi, north-west again. The total land area is about 16 sq. m. A volcanic formation is apparent in Lontor, a sickle-shaped island which, with Neira and Gunong Api, forms part of the circle of a crater. The arrangement is comparable with Santorin in the Aegean Sea. Gunong Api (Fire Mountain), 2200 ft. high, is an active volcano, and its eruptions and earthquakes have frequently brought destruction, as notably in 1852, when the damage was chiefly due to a huge wave of the sea. Banda, the chief town, on Neira, is a pleasant settlement, commanded by two Dutch forts of the early 17th century, Nassau and Belgica. The largest island, Lontor, was found too unhealthy to be the site of the principal settlement; but the climate of the islands generally, though hot, is not unhealthy. In the space between Lontor, Neira and Gunong Api there is a good harbour, with entrances on either side, which enable vessels to enter on either of the monsoons.

Between Gunong Api and Neira there is a third channel, but it is navigable for small vessels only. The principal articles of commerce in the Banda group are nutmegs and mace. The nutmeg is indigenous. The native population having been cleared off by the Dutch, the plantations were worked by slaves and convicts till the emancipation of 1860. The introduction of Malay and Chinese labourers subsequently took place. The plantations (perken) were originally held by the conquerors of the natives, the government monopolizing the produce at a fixed rate; but in 1873 the government monopoly was abolished. The production amounts annually to nearly 1,500,000 lb of nutmegs, and 350,000 lb of mace. The nutmegs are grown, in accordance with natural conditions, under the shade of other trees, usually the canari. Jalti or jatti wood is cultivated on the small island of Rosingen. The total population of the islands is about 9500, of which some 7000 are descendants of the natives introduced as slaves from neighbouring islands, and are Christians or Mahommedans.

The Banda Islands were discovered and annexed by the Portuguese Antonio D'Abreu in 1512; but in the beginning of the 17th century his countrymen were expelled by the Dutch. In 1608 the British built a factory on Wai, which was demolished by the Dutch as soon as the English vessel left. Shortly after, however, Banda Neira and Lontor were resigned by the natives to the British, and in 1620 Run and Wai were added to their dominions; but in spite of treaties into which they had entered the Dutch attacked and expelled their British rivals. In 1654 they were compelled by Cromwell to restore Run, and to make satisfaction for the massacre of Amboyna; but the English settlers not being adequately supported from home, the island was retaken by the Dutch in 1664. They remained in undisturbed possession until 1796, when the Banda Islands were taken by the British. They were restored by the treaty of Amiens in the year 1800, again captured, and finally restored by the treaty of Paris concluded in 1814.