Excavation of the ruins began in 1953 with the discovery of the Narsaq stick, the first Viking Age runic inscription discovered in Greenland.

A trading center was established here due to the natural deep water harbor which could accommodate ocean faring vessels, .

In the early 1900s seal hunting began to fail, and the main basis for the economy gradually shifted to fishing.

Simiutak at the Skovfjord mouth near Narsaq was a HF/DF radio range finding station called Bluie West Three during World War II.

However the settlement did not experience significant population growth until 1953, when its first prawn and fishing factory of Royal Greenland was established.

In addition to the town, the municipality consisted of the Qassiarsuk, Igaliku and Narsarsuaq settlements, as well as several sheep and reindeer farms.

South Greenland has experienced a decline in tourist revenue in recent years, but tourism still supports a significant percentage of the viable workforce.

Popular activities include hiking, fishing, collecting rare minerals and taking boat trips to the ice cap.

Narsaq is a port of call for the Arctic Umiaq Line coastal ship in the summer season.

In contrast to the rest of Greenland, the wider Narsaq area has a relatively extensive network of traversable dirt and gravel roads, totalling over 120 kilometers and requiring DKK 500,000 annually for service.

[11] The longest stretch of road envelopes the northern end of Tunulliarfik Fjord, and connects the sheep farms of Qassiarsuk with the airport of Narsarsuaq.

The roads are generally of poor construction, lacking crossfall for drainage, and using softer sandstone instead of harder granite, creating severe dust problems in the summer.

Narsaq has a tundra climate (ET) moderated by the Gulf Stream, with cool summers and cold winters.Narsaq is twinned with: