The city was incorporated in 1833.
Dahlonega as described in 1940 
Dahlonega, seat of Lumpkin County, is a trading center for mountaineers, who come to town on Saturdays to purchase their weekly supplies. The name of the town, suggested by the gold deposits of the surrounding area, is derived from Taulonica (Cherokee for 'yellow metal'). Occasionally, after heavy rains, small particles of gold are found in the streets of the town.
Although it is said that a gold nugget was found in this vicinity about 1818, the gold fields were not discovered until 1828 or 1829. Almost immediately this Cherokee territory was cluttered with the shanties of rough, adventurous miners, who were followed by gamblers and swindlers. Heavy drinking, gambling, and frequent brawls became an integral part of the settlement's life. Placer mining, known here as deposit mining, utilized crude apparatus and was an inefficient process; as two men worked together, one would shovel gravel into the "long tom" or trough. After the coarse gravel had been taken out, the residue was run over the corrugated "rippler," which had indentations filled with mercury to retain the gold.
During these intrusions on Indian land, Georgia sent out the militia to protect the Indians. In 1830 the state acquired the Cherokee territory and during 1831-1832 divided it into 40-acre "gold lots" which were disposed of by lottery. There was little regard for private property, however, and the miners panned gold wherever they found it.
Lumpkin County was created in 1832 and a year later, Dahlonega was settled at a place called Licklog for a hollowed log filled with salt for livestock. New settlers were arriving daily, and soon all roads leading to the town were lined with huts. At one time there were from 10 to 15 thousand miners within a radius of a few miles. When hotels were established, Tennessee hog drovers on their way to Augusta stopped in this town and slaughtered the hogs, selling the cheaper cuts of meat to the miners and taking the hams to Augusta.
The first important discovery of gold in the United States occurred in the Dalonega fields. The Federal government established a mint here which operated from 1838 until 1861, when it was closed because of Georgia's secession from the Union. During this period, 1,378,710 pieces of gold valued at $6,106,569 were struck; every coin was marked with a "D."
During the California gold rush of 1849, many of the restless adventurers who had come to Georgia moved westward. Matthew F. Stephenson, assayer of the mint, protesting against the emigration, said in praise of the local gold fields, "There's millions in it." This phrase was taken to California, where Mark Twain heard it and later made it famous in The Gilded Age. The section had also been depopulated by the war with Mexico, but by 1855 men had begun to return, and in 1858 the Yahoola and Can Creek Hydraulic Company was formed by Boston capitalists. $1-million was spent on machinery and the construction of canals and flumes. Although mining activity was halted during the War between the States, it was gradually resumed afterward and scientific processes introduced. A pronounced revival in mining took place in 1900 but was short-lived owing to the high cost of obtaining the metal. Since the increase in the value of gold within the last few years [late 1930s], the mines have again been opened. Of the $17.7 million in gold taken from Georgia dirt from 1830-1933, almost $16-million has come from Dahlonega fields. In 1935 a few mines produced gold valued at $34,790.