Panama came under Spanish control with the arrival of settlers in the 16th century. In 1821, Panama effectively became independent from Spain as the region was a department within the Republic of Greater Colombia. 

In 1903, Colombia and Panama disagreed on whether the U.S. should be allowed to build a canal across Panama. With the support of the U.S., Panama broke away from Colombia on November 3rd 1903. The canal was completed in 1914. 

Despite the support of the US in helping Panama achieve independence, there was some resentment that sovereign land (the Canal Zone) was controlled by another country in return for annual payments. 

To placate the protestors, in 1964, U.S. President John F. Kennedy agreed that the Panamanian flag would be allowed to be flown beside the U.S. flag on all non-military locations in the Canal Zone. Kennedy was assassinated before his orders became law and subsequent changes meant that instead of flying both flags, all flags would be removed. This angered the inhabitants of the Canal Zone, known as Zonians, who saw this as a sign that the U.S. might leave the area. The Zonians started flying the U.S. Flag in defiance of the rules. 

The U.S. flag was raised at Balboa High School in the Canal Zone. This led to about 200 Panamanian students marching to the High School with a treasured Panama flag that they planned to fly alongside the U.S. Flag. The police agreed that a small group of students would be allowed to hoist the flag. However, scuffles broke out and the flag was torn. 

News of the desecration of the Panamanian flag spread quickly and angry crowds gathered on the border between Panama City and the Canal Zone. Fuelled by wild rumours on both sides, the situation escalated into violence with shots being fired. The shooting led to the deaths of 21 Panamanians and four Americans. 

The incident is seen as a key event that eventually led to the U.S. renouncing their control of the Canal Zone. The area around the canal remained U.S. territory until 1979 and final U.S. involvement ceased on December 31st 1999. 

The day is marked by a march retracing the steps of the original student protestors. Survivors of the events will give speeches recounting the events of the day.