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Industrial district was initially introduced as a term to describe an area where workers of a monolithic heavy industry (ship-building, coal mining, steel, ceramics, etc) live within walking-distance of their places of work.

In England, such areas were usually characterized by block streets of Victorian terraced housing, often with the giant industrial structures looming over the houses. Very few working industrial districts are now left. In England they survive only in places like Stoke-on-Trent and a few mining towns where the pits have escaped the closures of the 1980s. Many such districts were notable for having a strong children's street culture.

The term appears to have been first used by Alfred Marshall in his The Principles of Economics (1890, 1922). Marshall talks of a.... "thickly peopled industrial district".

The term was also used in political struggle. The 1917 handbook of the IWW states:-

"In order that every given industrial district shall have complete industrial solidarity among the workers in all industries as well as among the workers of each industry, an INDUSTRIAL DISTRICT COUNCIL is formed ..."

The term also appears in English literature. For instance, in a short story of 1920 by D.H. Lawrence, You Touched Me (aka 'Hadrian'):-

"Matilda and Emmie were already old maids. In a thorough industrial district, it is not easy for the girls who have expectations above the common to find husbands. The ugly industrial town was full of men, young men who were ready to marry. But they were all colliers or pottery-hands, mere workmen."

Within the study of Economics, the term has evolved and now implies the ways in which economic specialisation arises through clustering in a particular industry-zoned urban area. Since the 1980s, the term has become connotated with an important element of dynamic industrial development in Northern Italy, where in the post-WW2-era clusters of small and medium-sized enterprises (SME) experienced strong growth. Industrial districts in Northern Italy have a coherent location and a narrow specialisation profile, e.g. Prato in woolen fabric, Sassuolo in ceramic tiles or Brenta in ladies' footwear.

The success of SME-based Italian districts was one of the factors that motivated economic development organisations across the world to adopt cluster promotion as an approach to stimulate growth and job creation. Practitioners in the field organised themselves in The Competitiveness Institute.

More recently, Italian industrial districts have been linked to Italy's poor growth performance. Firms in industrial districts battle to internationalise production, and they have only limited resources to invest in research and development.

• Industrial park