Naftalan is a city in Azerbaijan, surrounded by the rayon of Goranboy. It is on an agricultural plain near the Lesser Caucasus Mountains. The word naftalan also means a petroleum product which can be obtained there.
The word Naftalan, can be traced to the Greek word "naphtha" ("νάφθα"), meaning pertaining to oil, and the Azerbaijani suffix "-alan", which is of the verb "to take" (and literally meaning "oil buyer").
Archaeological findings in the region date to the 12th century AD. The qualities of Naftalan oil has been known since early times; Marco Polo noted them. The oil in the area was known to people as far as China and India, and was traded by caravans throughout countries of the Near East. Modern use of the oil has dated to the 1870s under Czarist Russia. By 1912, a Germanjoint-stock company was founded to export and trade the oil, which was used as a treatment in the Russo-Japanese War. Research on the properties of the oil continues to be done at Azerbaijan Medical University and the Scientific Arthritis Center of Azerbaijan.
In 2010s, the number of hotels increased in the city after Azerbaijani government's tourism policy.
The area is home to petroleumspas (or "oil spas"), once popular vacation spots of the Soviet Union that are making a return in popularity. Oil from these spas is claimed to be an effective treatment against psoriasis, arthritis and rheumatism. At the height of their Soviet-era popularity, the spas in Naftalan had 75,000 visitors a year. The combination of violent ethnic conflict in nearby Nagorno-Karabakh and the end of Soviet-sponsored free trips brought the industry to its knees in the late-1980s. All but one of the older spas were converted into refugee housing. The remaining spa, the Naftalan Therapeutic Center, had 1,000-beds.