Huatulco (Wa-tool-ko) is a small town located on the southern Pacific coast of Mexico. The Mexican state in which it resides in is named Oaxaca (Woah-ha-ka), thus the full name of the place is generally known as Huatulco, Oaxaca. The name Huatulco is not a local name, but the name given to the region by an invading imperialist tribe better known as the Aztecs. The original people of this land called themeselves Zapotecs. The name given to this place means: “place where the wooden cross is venerated”. There is a reason for that name, it's vaguely associated with some form of pre-Hispanic Christianity, but the story takes on mystical and mythological proportions, and begs an explanation from modern archeology. You can read more about it in the Santa Cruz Bay section.
The town Huatulco is blessed with several bays with pristine crystal clear turquoise blue waters. They give the false impression that one is facing Caribbean waters, but one is not, one is facing the Pacific!
Thus the small town has become a tourist destination for many international travelers, offering Gran Turismo and 5 Star Hotels, and all of the commodities that come with it. Nonetheless, the bays are still largely undeveloped, and unlike other beach spots in Mexico, here you can still enjoy the beauty and peace of a natural beach undisturbed by the modern world.
Furthermore, the town itself is fairly small, and unspoiled. Here you can enjoy local dishes at local prices (low) or visit high end restaurants that exemplify the excellent cuisine of Oaxaca, considered by many, if not all, to be the best cuisine in the entire Mexican country, and that in itself says a lot. Indeed, here you will find natural food with strong vivid colors, because for whatever reason, avocados here are greener than most places, the eggs here are more yellowish than most places, and the beans here are darker than most places…and the list goes on. If you are the historical and anthropological oriented type, you can also try pre-Hispanic delicacies (or Mesoamerican munchies) such as what they call “the dish of the flying prawn” or “flying shrimp” which is meant to be a humorous name to a dry and salted cricket eaten as a side snack. Crickets are not eaten anywhere else in Mexico, and most Mexicans are not aware that a minority of their countrymen in Oaxaca eats them…but Oaxacans are also famous for dishing up other rare meals.
What you can enjoy in Huatulco is a friendly unspoiled atmosphere. 
Natural beaches with astounding beauty, perfect for swimming, snorkeling or scuba diving. Authentic Mexican cuisine, at local prices; beware that there are no mega night clubs, or Hollywood Planet Restaurants, or Hard Rock Café’s or Hooter’s, as you will find in Cancun.
There are also no Star Bucks and believe it or not, I did not see a McDonalds establishment. There are also no large colonial buildings, no medieval Spanish castles, and no impressive colonial Cathedrals. Thus this has not been really developed neither by anyone on both sides of the border. Except for Tangolunda bay (where the mega resorts are located) the town is mostly nice and quiet and small, inhabited by local people. The reason to come here is to enjoy serenity and the beach, and the feeling that you are away from it all. So with that said, Huatulco still enjoys its share of tourism, so much that it has its own international airport!
