The village was founded in the early 17th century as part of the Plantation of Ulster, on land allocated to the Worshipful Company of Goldsmiths of London.

It remained a small settlement until the 1960s, until large amounts of social housing was built on adjoining townlands.

Newbuildings also has a post office, community association, retail units and a wide range of housing.

Newbuildings sits on an area of flat land between Clondermot Hill to the east and the River Foyle to the west.

Over time, the urban area of Newbuildings has spread into the following townlands:[2] Between 1900 and 1955 the County Donegal Railways Joint Committee had a station in Newbuildings, the line running from Stranorlar and other destinations and along the east bank of the River Foyle from Strabane to Londonderry Victoria Road.