Taco Palenque was founded by Juan Francisco Ochoa (Don Pancho) from Sinaloa, Mexico. Ochoa was also the creator of the El Pollo Loco secret chicken recipe and founder of the Grilled chicken concept. Don Pancho Ochoa and his brothers and sisters opened several El Pollo Loco franchises in Mexico in the late 1970s and the United States in the 1980s.

In 1985, Juan Francisco moved to Monterrey where he planned to create a Mexican fastfood chain in the United States with drive thrus that served authentic Mexican food. In 1987, Ochoa opened Taco Palenque in Laredo, Texas. The chain expanded to McAllen in 1998, Brownsville in 2001, San Antonio in 2007, Nuevo Laredo, Mexico in 2008, Houston, Texas in 2010, Mission, Texas, Cotulla, Texas in 2011 and Weslaco, Texas in 2015. In 2005 Palenque grill was established.

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