Matala, ancient Matelon, served as a port of Phaestus and Gortyn and is well known for the carved caves, which were graves in the Grecoroman times. The cape south of Matala has been identified as the Cape Nysos and the location where the ships of Menelaus were wrecked (according to the Odyssey).
The archaeological site near the village, the core of the ancient town, was excavated in the 1980s and brought to light large buildings and workshops of metallurgy, pottery, woodworking, etc. The town seems that flourished from the 6th BC until the 7th AD century, but was never abandoned.
Southeast of the village there are the ruins of an ancient temple and, near the beach of Matala a marble urn was found. The acropolis of the town was located on an adjacent hilltop, on the site where a Turkish tower (koules) was built.