The sulphur springs, I m. from the town, which yield over 500,000 gallons daily, are resorted to for the cure of rheumatism and skin diseases. By reason of its dry and bracing climate, Aliwal North is also a favourite residence of sufferers from chest complaints. In the neighbourhood are stone quarries. Aliwal North is the capital of a division of the province of the same name, with an area of 1330 sq. m. and a pop. (1904) of 14,857, of whom 40% are whites.

Aliwal North was so called to distinguish it from Aliwal South, now Mossel Bay, the seaport of the pastoral Grasveld district, on the west side of Mossel Bay. Both places were named in honour of Sir Harry Smith, governor of Cape Colony 1847-1852, Aliwal (see above) being the village in the Punjab where in 1846 he gained a great victory over the Sikhs.

Crossing the Orange River at this spot in September 1848, Sir Harry noted that it was "a beautiful site for a town," and in the May following the town was founded. In the early months of the Boer War of 1899-1902 Aliwal North was held by the Boers. It was reoccupied by the British in March 1900.

The spa has large thermal pools, including two for children, as well as saunas, a gym and a treatment block with amenities for invalids. Water sports are popular on The Island where 27 waterfowl species have been recorded.

East of Aliwal North, Buffelspruit Nature Reserve supports a number of game animals.

It lies on a strategic ford on the Orange River which was used by the Bushmen and the Voortrekkers. This was upgraded with a pontoon in 1872.

The town developed simultaneously as a health resort and transport centre with the railway from East London reaching the town in 1885. This prompted rapid development as a commercial centre for the north-eastern region of the British colony.