Dachwig was named Dagoberti Vicus (Dagobertsweg) as early as 874. This name is said to be due to the Germanic king Dagobert, who may have founded the village. Later place names were Dachebechi and Tachabechi. The village already had a population of 1142 before the Thirty Years' War due to agriculture and crafts.

After plundering, devastation and the plague, Dachwig still had 109 inhabitants after the Thirty Years' War. The former village church was in front of the village on the Johanneskirchberg, today's church in the village center was completed in 1863. The village was hit by several disastrous fires. The Dachwig railroad station and the train line were opened on November 25, 1897.

In 1945, Dachwig was devastated by firebombs in the last days of the war. As a result, 56 houses and farm buildings were destroyed. Tireless hard work and creativity have been a tradition in Dachwig since time immemorial. The village emerged in new beauty. In 1975, the village celebrated its 1115th anniversary and today's village museum was inaugurated.

In 2010, the village celebrated its 1150th anniversary with the 8th Thuringian Festival of Costumes. Village history is preserved in the Dachwig village museum. Old farming and craft traditions as well as pictures of the village's eventful history can be seen here.

In recent years, the municipality of Dachwig, which today has 1,600 inhabitants, has experienced a particular upswing. The newly created industrial estate with numerous companies located there and the residential area "Am Kornbach" have emerged. Road and sidewalk construction and the creation of green spaces have made Dachwig an attractive place to live with its healthy local infrastructure, including the beautiful outdoor pool. Numerous renovated houses in the village also ensure a beautiful townscape. A lively club life also makes Dachwig a very lively village.