The town of Baumholder is the administrative seat of the like-named Verbandsgemeinde, a state-recognised tourism resort and, according to state planning, a middle centre.

A great part of the Baumholder Troop Drilling Ground abutting the town serves as a refuge for many plant and animal species that have become rare, for example the common kingfisher, the lynx and the badger, some of which are on the IUCN Red List.

Its designation as a Restkreis arose from its being what was left of the Sankt Wendel district on the Prussian side of the border once the Territory of the Saar Basin had been formed under the terms of the Treaty of Versailles.

In the 20th century, Baumholder became a garrison town when the Wehrmacht built its barracks and troop drilling ground here.

After the Second World War, after a short occupation by the United States Army, French soldiers were stationed in Baumholder for a few years.

The United States Army built the troop drilling ground beginning in 1951 into one of its biggest garrisons in Germany, which also brought Baumholder a considerable upswing in its economy in the 1950s: bars opened, as did dancehalls and music halls.

[6] On August 10, 2005 a group of US Army soldiers engaged in a crime spree within the town of Baumholder, burgling several US Government buildings in Smith Barracks.

The soldiers stole computer equipment, robbed a local German taxi driver, and ended their spree early the next morning by setting fire to the Town Hall (Rathaus).

Private First Class Zachary Watson and Specialist Samuel Bell were arrested by German authorities in connection to the crimes which totalled more than €1.5 million in damage.

[8] In a separate court-martial proceeding, Bell was sentenced to seven years in prison, dishonourable discharge, demotion to private and forfeiture of all pay and allowances.

The municipal election held on 7 June 2009 yielded the following results:[10] Baumholder's mayor is Günther Jung (FWG).

[1] The German blazon reads: Das Wappen der Stadt Baumholder zeigt im silbernen Schilde einen aus grünem Dreiberg aufwachsenden grün belaubten Holder- (Holunder-) baum.

Neben dem Stamm desselben erscheint an nach außen gebogenen grünen Stielen rechts und links je eine vergrößerte, naturfarbene (weiße) Blüte des Holderbaums.

The town's arms might in English heraldic language be described thus: Argent issuant from a mount of three vert in base an elder tree leafed of the same between two elder blossoms proper, also issuant from the mount, the dexter with stem embowed to dexter and the sinister with stem embowed to sinister, the shield ensigned with a mural crown with three towers masoned and embattled proper.

The arms have been borne since 8 February 1909 when they were approved, with a signature on the watercolour original, by Wilhelm II, King of Prussia.

Ever since that time, the 13,000 or so United States military personnel and their dependents have characterized the town's image scenically, economically and even socially.

Many of the town's shops accept United States dollars in payment and are to a great extent dependent on American currency.

To this day, the United States forces and the Bundeswehr are the biggest employers of the town's German population.

Some of the US troops stationed in town were regularly deployed in the Iraq War, and for the most part, returned afterwards to Baumholder.

On 9 October 2012, the 170th Infantry Brigade was inactivated ending a decades-long legacy of combat units stationed at Baumholder's Smith Barracks.