US control over the Panama Canal symbolised Washington’s dominance in Latin America. The Torrijos–Carter Treaties of 1977, concluding years of negotiations, marked a turning point by transferring control over the Canal to Panama. This work focuses on the crucial May 1977 round of negotiations, a pivotal yet underexplored period, whose outcome laid the foundation for the treaties, addressing key issues such as control over the Canal Zone and the neutrality of the Canal. This study addresses gaps in the existing literature through newly available archival sources, offering a more detailed understanding of the negotiations that shaped the future of the Panama Canal.