The town was seat of a noble lineage and in 1135 appears in a document presumably for the first time ("Adalbert von Ludun"). Lauda belonged to the lords of Luden up to the 13th century, and they also gave the settlement its name. From Luden there emerged Ludin, Luten, Lauden and finally Lauda in about 1500. In 1344 a town charter was conferred by Emperor Ludwig of Bavaria. After varied and eventful conditions of lordship, in 1506 Lauda became an administrative town of the Prince-Bishopric Würzburg and was responsible for about half of the current municipal area. In 1803, Lauda joined the Leiningen Principality, in 1806 the Great Duchy of Baden.
The new political marginalization caused heavy economic setbacks; the expansion to the railway node after 1866 led to a new recovery. In 1921/35, Lauda as well as neighbouring Königshofen lost their town charters; they were once again conferred in 1950. Lauda is today the by far most populated of the municipal subdivisions.
Prince-Bishops, viniculture and wine trade secured a great boom in Lauda. The late Gothic St. Mary's Church with lavish Rococo furnishings and the high Baroque Stations of the Cross in the town cemetery, the Catholic town church built in 1694 on the foundation walls of its gothic predecessor with its preserved Renaissance portal, the Blutskapelle (Blood Chapel) with its votive image (early representation of a pogrom against the Jews), remains of the town wall, the important Upper Gate, numerous shrines and imposing half-timbered buildings in the typical Frankish old town that are fortunately nearly completely preserved all still remind us today of those past times.