Psychro is the most touristic village of the Plateau due to its cave (Diktaion Andron) which is located right above the village. According to tradition, but also due to many cult relics that have been found inside the cave, it is considered to be the place where the father of the Olympian Gods, Zeus, was born and mainly worshipped. The cave is one of the most unique caves in Crete, as it has hundreds of small and large stalactites. It is one of the most touristic places in Crete and has been visited by tens of thousands of tourists every year for 60 years.
The village of Psychro, like all the villages of Lasithi, was built during the last centuries of the Venetian rule. After the complete destruction of the entire province in 1364, a century later, in 1465, Venice decided that the plain had to be cultivated for grain production. Since then, farmers could stay on the Plateau during the sowing and harvesting season. It is built at the foot of Mount Toumba Moutsounas (1,537 m) and was the seat of the Eastern municipality of Plateau in 1900 during the Cretan State. There are various hypotheses about the origin of its name: some connect it to the location where it is built, others consider it to be of pre-Greek origin, and others that it is due to a source of cold water located in the village.
It was probably uninhabited then. In the Turkish census of 1671, it was listed as Psihro with 42 families.
Population trend according to the censuses: