Lidzbark was founded by the Teutonic Knights at the beginning of the 14th century, most probably in 1306 (there is also a version, that it was founded under the German law in 1301, before the Chełmno and Michałów Land was given to the Teutonic Knights in 1303). The order erected a castle, a church of St. Wojciech, a mill and a town hall. The town was fortified. Different dates of granting the town privileges are given: 1303, 1415, 1416. Throughout its existence it was a small town where old traditions were maintained (also guild traditions), and which constituted an administrative-trade-craft centre. Its higher status in the Teutonic state was connected mainly with a close neighborhood with Masovia.
In 1454 Lidzbark was incorporated into Prussian Confederation. In 1466 under the Piece of Toruń, it became a part of Polish Republic, and it was a capital of the “Lidzbark circle”. Being within Poland resulted in great prosperity for Lidzbark which was founded on the granted royal privileges.
After the first partition of Poland in 1772 Lidzbark became a part of Prussia. It stayed within its borders until 1920, excluding 1807-1815, when it was a part of the Duchy of Warsaw. The second half of the 19th century and the beginning of the 20th century brought economic development, revival of local industry and an increase of the trade exchange. It was a result of opening a railway line Działdowo – Brodnica in 1887.
In the Second Polish Republic the town belonged to the district of Brodnica in the Province of Pomorze. In 1932 it was relocated to the Province of Działdowo, and in 1939 from the Province of Pomorze to the Province of Warsaw. During the Nazi occupation it was within the Third Reich. In the course of war operations many inhabitants died, and the buildings were destroyed in 75%.
The scale of damages from the WWII period was so enormous that after 1945 the town was built from scratch. Since 1999 it belongs to the District of Działdowo of the Warmińsko-Mazurskie Province. It is prospering thanks to tourism. Guests are attracted with the lake region and landscape parks - Górzno-Lidzbark and Welsk Landscape Parks.
- Dzimira M., Historia Lidzbarka 1301–2011: tajemnice i ciekawostki, Lidzbark 2012.
- Klemens E., Lidzbark Welski: z dziejów miasta i okolic, Olsztyn 1976.
- Kościński K., Przyczynki do historyi ziemi michałowskiej: miasto Lidzbark, Poznań 1906.