It is located on the right bank of the Lower Elbe at the confluence of the small Rhin river, about 45 km (28 mi) northwest of Altona.

Glückstadt was founded in 1617 on the marsh lands along the Elbe by the Duke of Holstein, King Christian IV of Denmark, who had levees and fortifications built as well as a ducal residence.

As Christian IV promised the settlers tax exemption and freedom of religion, Glückstadt soon became an important trading centre, intended to compete with the Imperial city of Hamburg, located upstream on the Elbe.

After the king had interfered in the Thirty Years' War, the town in 1627/28 was besieged for fifteen weeks by the united Imperial and Catholic troops under the command of Albrecht von Wallenstein and Count Tilly, though without success.

[2] In 1649 Christian’s son and successor King Frederik III of Denmark had the seat of the Holstein administration moved to Glückstadt, whereafter the duchy became known as Holstein-Glückstadt.