'Balibago' originates from Philippine languages (commonly Tagalog or Kapampangan) as a place name; it is likely a compound of local morphemes but the exact original elements are uncertain.

'Balibago' developed as a local toponym in the Philippines and entered English usage simply as the proper name of that barangay and its surrounding district; over time English sources referring to the area have adopted the same spelling.

Initially used only as a local place name, the term has also come to be used metonymically to refer specifically to the area's entertainment and red-light district.