The townland the village is in was formerly known as Ballydonnelly (
Irish:
Baile Uí Dhonnaíle who had held the role of marshalls to the O'Neills of Tyrone. According to
Gaelic Irish tradition, the O'Donnellys were part of the
Cenél nEoghain making them kin of the O'Neills. In their role as Marshalls to the O'Neills they were responsible for fostering the children of 'The O'Neill'. The O'Donnellys reached the height of their role during the time of
Shane O'Neill when Dean Terrence Danyell (Turlough O'Donnelly) of Armagh played a key role in communications between Shane O'Neill and Elizabeth I. The earliest mention of Ballydonnelly is the
Annals of the Four Masters in 1531 when it is said ''Baile-Ui-Donnghaile was assaulted by Niall Oge, son of Art, son of Con O'Neill. He demolished the castle; and he made a prisoner of the son of O'Neill, who was foster-son of O'Donnelly, and carried him off, together with the horses and the other spoils of the town.”'' At the start of the
Plantation of Ulster, Ballydonnelly was allocated as a 'Servitor' portion and as such was granted to
Sir Toby Caulfeild who had served in the Crown forces during the '
Nine Years War'. The '
castle' to which the placename refers is atypical of most Plantation structures, in that it is not the more usual fortified
tower house, and was built for Sir Toby Caulfeild in the style of an
Oxfordshire manor house. This manor house, called
Castle Caulfield, was badly damaged by fire during the
1641 rebellion and was only reused in a limited capacity thereafter by the descendants of the Caulfeild family. Throughout the 18th and 19th centuries, the village was a centre for the developing linen industry, and many mills and farms located in and around the village were involved in linen production. This culminated in the building of the Acheson & Smith Works (later David Acheson Ltd) in 1874. The factory was in operation until 1978/79 before closure. It was a major employer within the district. ==Places of interest==