It serves as the administrative centre of the Dikhil Region, and is home to the Afar and Somali ethnic groups.

The engravings oldest discovered to date are from the fourth or third millennium BC, the most famous is the site of Handoga near Dikhil where the ruins of a village squares sub circular dry stone delivered different objects.

Including ceramic shards matching vases used brazier, or containers that can hold water, several choppers and microliths, blades, drills, trenchers basalt, rhyolite or obsidian.

The village was originally built around the well of Harrou near a wadi, with houses constructed of mud and stone, the Afar and Issa were the founders of Dikhil.

When Wilfred Thesiger visited Dikhil in May 1934, he was struck by "a most impregnable fort here" recently constructed by the French colonial authorities.

On January 17, 1935, Albert Bernard was a colonial administrative student, learned that an Assaïamara raid had looted camps and returned to the west to Ethiopia.

On the morning of the 18th, near Môdathou, south of Lake Abbe, he led an attack against the group, but his troops, although better equipped, were overwhelmed by the number.

Negotiations at Dewele, Italian East Africa on the local implementation of the armistice were only finally completed on 8 August.

Christian Raimond Dupont surrendered and Colonel Raynal's troops crossed back into French Somaliland on 26 December 1942, completing its liberation.

Following the conclusion of the 1977-1978 Ogaden War, Dikhil along with Ali Sabieh accommodated three quarters of the 8,000 Issas who had fled from Ethiopia.

In 1979, the first President of independent Djibouti Hassan Gouled Aptidon in Dikhil the party founded the People's Rally for Progress, which has since dominated the politics of Djibouti, its led by President Ismail Omar Guelleh and is in a coalition government with Front for the Restoration of Unity and Democracy (FRUD) and other parties.

[1] The town inhabitants belong to various mainly Afro-Asiatic-speaking ethnic groups, but the Afar and the Issa Somali are predominant.

However, due to the town's altitude and inland location, its climate features are the humidity is very low, and temperatures usually fall on 28 °C (82 °F) at night, which makes summer particularly pleasant compared to coastal cities.