Killeshandra has played a notable role in Irish history, particularly during the Ulster Plantation period in the 17th century.

During the early 17th century, the British Crown initiated the Ulster Plantation, aimed at settling English and Scottish Protestants in Ulster. Sir Alexander Hamilton was granted lands in Killeshandra in 1610 to build a strong bawn (fortified enclosure) and create a Protestant community.

The new settlers, including Scottish and French Huguenot exiles, brought with them skills in linen production. This industry became a significant part of Killeshandra's economy, contributing to the town's growth and prosperity.

Killeshandra's name, derived from the Irish "Cill na Seanrátha" (church of the old rath), reflects its religious heritage. The town's church was first noted in Papal registers during the 14th century. During the Ulster Plantation, the church was reformed for Protestant use and played a central role in the community.

Throughout its history, Killeshandra faced challenges, including the 1641 Irish Rebellion, which led to the burning of the township. Despite these hardships, the community demonstrated resilience, rebuilding and continuing to thrive.

Today, Killeshandra is recognized for its natural beauty and historical significance. It serves as a gateway to the UNESCO Cuilcagh Lakelands Geopark and is part of the Lough Oughter Special Protected Area.