From ancient times, 5 settlements have existed around the bay and Borðoy cove, where Klaksvík is today: Í Vági, á Uppsølum, í Gerðum, á Myrkjanoyri and á Oyri.  

Klaksvík was originally the name of small cove with now settlemnt to the left of the main bay. But when the Royal Trade Monopoly established a branch in this cove in 1838, it became so important for all the Northern islands that the name of this cove eventually became the common name for all the settlements.  

This was the beginning of the region’s emergence out of its local isolation, which eventually would tie them to places in many foreign lands. The centre of this change were these settlements around the bay. However, it was not before about a 100 years later, when the development truly sped up and the neighborhoods were grown together that people began to use Klaksvík as the common name for all the neighborhoods.  

Until the mid 19^th century Klaksvík was not really one village but rather five settlements that lay in some distance from each other.