Economic growth began with shipping cooperage stock, forest products, and produce.

[8] Hill City is along the shores of Hill Lake, a glacial formation roughly 2 miles (3.2 km) long and an average of 0.25 miles (0.40 km) wide.

36.9% of all households were made up of individuals, and 17.4% had someone living alone who was 65 years of age or older.

The racial makeup of the city was 97.49% White, 1.88% Native American, and 0.63% from two or more races.

29.1% were of German, 15.7% Norwegian, 8.8% Irish, 5.9% Finnish and 5.2% French Canadian ancestry according to Census 2000.

36.2% of all households were made up of individuals, and 16.0% had someone living alone who was 65 years of age or older.

The town and surrounding area is also home to an ATV dealership, two restaurants, three bars, two liquor stores, a K–12 school, two gas stations and several parks, one of which offers camping.

Its attractions include a golf course, a weight room, and townhouses that resemble the city from the 1920s.

The Fourth of July celebration is the biggest week in Hill City.

Approximately 1,500 people vacation in Hill City for the 4th of July Parade and later events which include street races, egg tosses, pie-eating contests, turtle races, a sawdust pile for the kids, multiple hot dog and beer carts, a street dance, and fireworks.