Hi/Saludos!

Puerto Rico has been a territory of the USA since the Spanish-American War (1898) when Spain gave the island to the USA as part of the peace treaty. Territory means that the land belongs to the United States but it is not a State. In this arrangement, PR has a popularly elected local government that governs the internal affairs of the island. Military and international affairs are governed by the USA federal government in Washington, DC. Puerto Ricans pay local taxes but no taxes to USA. Local currency is USA dollar. Puerto Ricans can freely travel to and within USA like any other USA citizen and are issued USA passport for international travel.

The people living in Puerto Rico are USA citizens but they differ among themselves about what the future relationship between PR and the USA should be. A very small minority (about 5%) believe that PR should become an independent nation. The remaining 95% are almost evenly split between split between keeping the status quo (territory) or joining the USA as a new state.

PR recently held a plebiscite on the political status question and it appears that the statehood option is becoming increasingly more popular.

I hope this answers your question. If not feel free to ask more. :-)

There are a few other US territories as well, like American Samoa in the Polynesian islands