The distillery was founded in 1896 by a group of assemblers, wishing to engage in the production of their own whisky.

The history of the distillery was fairly quiet, without changing owners, but still marked by a long dormancy between 1927 and 1947.

Unlike its neighbours, the Tamdhu distillery has no roof-shaped pagoda above its malt furnaces.

It was announced that as of April 2010, the Tamdhu Distillery, belonging to the Highland Distillers subsidiary of the Edrington Group, was being closed and the plant shuttered.

It was then sold to Ian MacLeod Distillers in June 2011, who recommenced production of single malt in May 2013.