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Dracena was founded on December 8, 1945 on the initiative of Irio Spinardi, João Vandramini, Virgílio and Florêncio Fioravanti. It grew rapidly, and became an independent municipality in 1953, when it was separated from Gracianópolis.
The climate is subtropical, The annual medium temperature is 23.4 °C (74.1 °F), the warmest month is January 27.8 °C (82.0 °F) and the coolest month is July 17.3 °C (63.1 °F). The highest temperature ever registered was 43.1 °C (109.6 °F) and the lowest, −4.1 °C (24.6 °F).