It was founded in 1919 by Isaac Carasso in Barcelona, Spain as a small factory producing yoghurt, which being originally from the Balkans was not very well known in Western Europe at that time. The name of the factory was chosen to be "Danone" as a diminutive of the name of his son, Daniel.
Ten years later, the first French factory was built, but during WWII, the company was moved to New York, where Dannon Milk Products Inc. was founded. Then in 1958, the company returned to Paris, where its headquarters are located today.
As a result of recent campaigns for fatless yoghurt, in Spain cuerpo Danone ("Danone body") has become a slang term for a model-like, meagre, muscular body.