The role of the Catholic Church in Guatemalan society in the Hispanic period was considerable, until independence in 1821. However, the Church began to lose prominence with the implementation of the liberal reforms from 1871 and the presidency of Justo Rufino Barrios (1873–85). The government expropriated Church assets, expelled the few religious orders and introduced a series of legal, political, social and economic changes that ended clerical dominance. At the same time, secular education, a certain freedom of the press and apparent freedom of worship were promoted. In addition to neutralising the Catholic Church and the power it had held, the liberals wanted to foster an environment favourable to foreign investment, mainly North American and European, which founded industries and promoted new crops for export, especially coffee. Barrios considered it essential to open the door to Protestants and create conditions under which foreigners could practise their religion and attend their churches. He personally invited the New York City Presbyterian Church to send missionaries to Guatemala, the first being the Reverend John Clark Hill (1882) and the second Edward M. Haymaker (1888). The Presbyterians were followed by the Central American Mission, the Mission of Friends of California (or Quakers), the Church of the Nazarene (known as the Nazarenes), the Baptists, the Seventh-day Adventist Church and the Primitive Methodist Church; all missions were based in the USA.

The Pentecostal churches arrived in Guatemalan territory during the 1920s and 1930s. The Full Gospel Church of God (IDEC) – affiliated with the Church of God (Cleveland, Tennessee) – began its work in 1916 under the auspices of the Methodists. The Assemblies of God (AD) started during the late 1920s. Pentecostal presence was very weak until the decision in 1936 to work on a regional basis. The IDEC focused on the Indigenous areas of the centre and west of the country, while the Assemblies of God had a greater impulse in the east, among the mestizo population. Currently both churches are distributed throughout the national territory. Other important Pentecostal churches include the Prince of Peace Church, the Foursquare Church, Galilea, Agua Viva, Agape and La Fe.

For its part, the Catholic Church in Guatemala, during the period of liberalism and modernisation, which lasted until 1944, survived with limitations and persecutions.