According to Knibb Sibley, Martha Brae river has given its name to the town near its mouth and to the watershed which it drains. It has its source at Windsor and flows into the sea at Rock after passing the village. The name appears to be a corruption of the Spanish Rio Para Matar Tiberon shown on a Spanish map dated 1680. It was a main artery in Trelawny and links many of the sugar plantations to the port.

The present Martha Brae town was created by Henry Cunliffe in 1762 out of the eastern portion of his sugar estate, Holland. He named the town Lyttelton, after the then-Governor of Jamaica, William Lyttelton, but this name was gradually lost and the town reverted to the older name of the nearby river.

Martha Brae watershed is one of Water Resource Authority's administrative units.