Major Price platted the town on a compass-aligned grid in 1837, reserving a large central square for the new county government.

[6] Maj. Price and Daniel Banfill contracted to construct the first county courthouse, which stood on the square from 1838–1851.

[8] Pleasant Ridge, one of the first African-American communities in Wisconsin, was founded just outside Lancaster by the Shepard family in 1849 and settled in the 1850s.

[9] Lancaster is located in the unglaciated "Driftless Area" of southwest Wisconsin whose topography is strikingly different from that of the rest of the state.

According to the United States Census Bureau, the city has a total area of 3.01 square miles (7.80 km2), all of it land.

32.4% of all households were made up of individuals, and 16.6% had someone living alone who was 65 years of age or older.

31.8% of all households were made up of individuals, and 18.1% had someone living alone who was 65 years of age or older.

In the spandrels of the courthouse dome are four allegorical murals painted by Franz Edward Rohrbeck.

The L. J. Arthur House, noted for its architecture, is also listed on the National Register.

The Lancaster Post Office contains a Depression-era mural, painted under the Works Progress Administration program in 1940.

Lancaster Municipal Airport (73C) serves the city and surrounding communities.