How to make Search Engine Friendly (SEF) URLs work in Joomla! on Nginx

Search engine friendly (SEF) URLs are the links to the articles of your site in a form that is easy on the eye. They at least partially show what the post on your site is about. If this option is on, then all the links to your posts/articles turn from an abracadabra into links to html pages.

To make it work in Joomla on a server with Nginx you need to add these lines to the configuration file of your site and restart Nginx so that the changes take effect:

location / {
	try_files $uri $uri/ /index.php?q=$request_uri;
}

Then log into the admin panel, go to the Global Configuration section and tick the checkbox next to Search Engine Friendly URLs

Optionally you can turn on the Add suffix to URLs option and change the suffix that will be added to the links. By default the value of the suffix is .html.

If you have no access to the admin panel - these parameters can be set in the configuration.php file, or you can temporarily reset the admin password.

Enabling Search Engine Friendly (SEF) URLs on Nginx - Joomla! Documentation.