Parakou [pa.ʁa.ku] is the largest city in northern Benin, and the third-largest city in the country, with an estimated population of 206,667 people, and capital of the Borgou Department. Administratively, the commune of Parakou makes one of Benin's 77 communes.^{[citation needed]}

The city was founded in the 16th century by traders. In the 18th century Parakou, like much of the surrounding region, came under the rule of princes from Nikki. The defeat of the Nikki-led invasion of Ilorin in 1837 and death of its king gave Parakou and the other vassals an opportunity to seize more control over trade and increase their political independence. The Anglo-French Convention of 1898 divided the Borgu federation in two. Parakou became the main administrative center of the half that was joined to French Dahomey.

Parakou lies on the main north-south highway RNIE 2 and at the end of a railway to Cotonou.

This has made it an important market town, with major industries including cotton and textiles, peanut oil manufacture and brewing. The town grew initially from revenue generated from passing merchants that took goods from the region across the Sahara and the Mediterranean to Europe. Parakou later became well known in the slave trade. Later traders concentrated on cotton and Parakou remains the hub of the Beninese cotton trade to this day, with considerable interest from Europe.

There are several markets trading, notably the largest, Grand Marché Arzeke which one of the largest in Benin, an international market spanning over a block. This market has a large covered hall overlapping onto the streets with stalls, with 500 and 1000 vendors. The market sells an enormous range of goods from items of pottery including vases and bowls, to cotton textiles, cassettes and CD's of local and international artists, local spices, fruits, gasaru/wagasi (cow's milk cheese) and kitchen utensils. Another market, located several blocks north, is called the "Marché Kobo Kobo", which lies across the street from the French Cultural Centre. Marché Kobo Kobo is known for its clothing retailing, primarily second hand goods, and in another section livestock. The Marché Depot is located near Parakou Railway Station around numerous hotels and sells mostly food but also calabashes and baskets. There is also the Marché Guema, located next to Guema Church on the northern road to Malanville in the Albarika quarter of the city. The market was founded by the Somba people of the Atacora, and takes place every Sunday at 10 am. The market consists of a collection of grass huts, and specialises in beef and pork and local millet beer known as choukachou or simply "chouk".

Parakou is the site of a proposed inland port.

The dry port is a multi-modal platform located 3 km from the centre of Parakou, close to the railway. It gives the Backbone Project a strategic position for imports and exports to neighbouring countries, notably Burkina Faso, Mali, Niger, Nigeria and Togo.

The name, Parakou, is derived from a Dendi word meaning "the city of everyone", named for the city's diversity of ethnicities. As a market town attracting many people as a trading and stop-off point, Parakou has a large mix of African ethnicities, including Fula, Dendi, Somba, Fon, Mina, Bariba, Djerma, Yoruba (of the Nago tribe), Hausa, Kabrais, Warma, and Tuareg.