The town's nickname, "Spacetown", derives from the fact that Derry is the birthplace of Alan Shepard, the first astronaut from the United States in space.

The area was first settled by Scots-Irish families in 1719 as part of the town of Londonderry, as were present-day Windham and portions of Manchester, Salem and Hudson.

The first potato planted in the United States was sown in Derry in the town's common field in 1719.

[5] The town is the location of two of America's oldest private schools, Pinkerton Academy, founded in 1814 and still in operation, and the closed Adams Female Seminary.

Derry was once a linen[6] and leather-making center until New England textile industries moved south in the 20th century.

The Robert Frost Farm is now a National Historic Landmark and state park and is open to the public for tours, poetry readings and other cultural events from spring through fall.

The Manchester and Lawrence branch of the Boston and Maine Railroad ran through Derry, but is now abandoned, with most of the line in town now a rail trail.

The New Hampshire Department of Transportation stated in its I-93 corridor transit study[8] and its 2012 statewide rail plan[9] that it could be feasible to reopen the line.

Island Pond is on the southeastern border of the town and drains to the Spicket River, another tributary of the Merrimack.

[10] The highest point in the town is Warner Hill, at 605 feet (184 m) above sea level, where from the top one can see the Boston skyline on a clear day.

On the Executive Council of New Hampshire, Derry is in district 3 and is currently represented by Republican Janet Stevens.

Derry is part of a reliably Republican belt of dense, populous towns along Interstate 93 near the Massachusetts border.