Having been inhabited since the Neolithic period, Dundalk was established as a Norman stronghold in the 12th century following the Norman invasion of Ireland, and became the northernmost outpost of The Pale in the Late Middle Ages. The town came to be nicknamed the "Gap of the North" where the northernmost point of the province of Leinster meets the province of Ulster. The modern street layout dates from the early 18th century and owes its form to James Hamilton (later 1st Earl of Clanbrassil). The legends of the mythical warrior hero Cú Chulainn are set in the district and the motto on the town's coat of arms is Mé do rug Cú Chulainn cróga (Irish) "I gave birth to brave Cú Chulainn".
The town developed brewing, distilling, tobacco, textile, and engineering industries during the nineteenth century. It became prosperous and its population grew as it became an important manufacturing and trading centre—both as a hub on the Great Northern Railway (Ireland) network and with its maritime link to Liverpool from the Port of Dundalk. It later suffered from high unemployment and urban decay after these industries closed or scaled back operations both in the aftermath of the Partition of Ireland in 1921 and following the accession of Ireland to the European Economic Community in 1973. New industries have been established in the early part of the 21st century, including pharmaceutical, technology, financial services, and specialist foods.
There is one third-level education institute—Dundalk Institute of Technology. The largest theatre in the town, An Táin Arts Centre, is in the Town Hall, and the restored buildings of the nearby former Dundalk Distillery house both the County Museum Dundalk and the Louth County Library. Sporting clubs include Dundalk Football Club (who play at Oriel Park), Dundalk Rugby Club, Dundalk Golf Club, and a number of Gaelic football clubs. Dundalk Stadium is a horse and greyhound racing venue and is Ireland's only all-weather horse racing track.