It was released as the fifth and final single from her third studio album, True Blue, on February 25, 1987, by Sire Records. The instrumental version of the song was first offered to Michael Jackson before Madonna accepted it and wrote the lyrics and melody. "La Isla Bonita" is noted for being the first Madonna song to have a Spanish influence in it, with arrangements of Cuban drums and Spanish guitar, maracas, harmonicas and a mix of synthesized and real drumming. The lyrics of the song tell about a beautiful island and was a tribute to the beauty of the Latin people according to Madonna.

"La Isla Bonita" achieved worldwide popularity, topping charts in countries such as Austria, Canada, France, Germany and Switzerland. It became Madonna's fourth number-one single in the United Kingdom, giving her a record for most number-one singles among female artists. In the United States, it reached number four on the Billboard Hot 100 chart. In the accompanying music video, Madonna portrayed two opposite characters – a pious girl and a passionate Latina. The Latin style and the flamenco red dress she wore became a trend later. The song is one of the most performed live songs by Madonna, appearing in five of her world tours including 2008–09's Sticky & Sweet Tour. Madonna has regularly performed the song in its Spanish form, sometimes with tribal or folk songs and remixes to accompany it.