Cradley Heath was originally a village in the south Staffordshire countryside, near the border with Worcestershire. It became part of Rowley Regis County Borough in 1894 and at around that time Cradley Heath developed two prolific industries - chainmaking and nailmaking - which would remain strong for decades afterwards. It was only during the 1980s' recession that the industries based in Cradley Heath began to decline.

Cradley Heath is one of several towns in central England which are easily recognisable today as to what they were in the early 20th century. Many of the shops and houses in the town's High Street are still standing after 100 years, although some are now awaiting demolition to make way for a by-pass which locals hope will at last relieve the gridlock which had plagued the town centre for decades.

Cradley Heath was part of Rowley Regis County Borough from 1894 to 1966, Warley County Borough from 1966 to 1974 and since 1974 has been part of Sandwell Metropolitan Borough.

For many years the Cradley Heath area has been synomynous with having a large number of residents with the surname Homer.