The municipal economy centers around wood processing, agriculture, and commerce. Tourism is also central to the community, with the beaches along the Lyngdalsfjorden and Rosfjorden being popular resorts during the summer.
The parish of Aa was established as the municipality of Lyngdal on 1 January 1838 (see formannskapsdistrikt). On 1 January 1909, the municipality was split into three: Austad in the south (population: 1,263), Kvås in the north (population: 736) and Lyngdal in the central area (population: 2,698). During the 1960s, there were many municipal mergers across Norway due to the work of the Schei Committee. On 1 January 1964, the municipalities of Austad (population: 608), Kvås (population: 493), Lyngdal (population: 2,916) as well as the Gitlevåg area (population: 103) in Spangereid municipality, west of Lenesfjorden, were all merged together to form one large municipality of Lyngdal. On 1 January 1971, the Ytre Skarstein and Indre Skarstein areas of Lyngdal (population: 21) was transferred to the neighboring municipality of Farsund. On 1 January 2001, the municipality of Lyngdal declared that the municipal centre of Alleen would be a town called Lyngdal.
The municipality is named after the Lyngdalen valley in which the municipality is located. The Old Norse form of the name was Lygnudalr. The first element is the genitive case of the river name Lygna and the last element is dalr which means "valley" or "dale". The river name is derived from logn which means "quietness" and so the meaning is "the quiet one". Prior to 1908, the parish (but not the municipality) of Lyngdal was called Aa, named after the vicarage. The name of the vicarage was first mentioned in 1312 as "a Am", the dative plural of á which means '(small) river'. The farm lies between two rivers.
The coat-of-arms is from modern times; they were granted on 27 March 1987. The arms are green with a white cow facing left in the center. The local breed of cows (lyngdalsku) is very well known in Norway and at the yearly cattle fair traders from all over Southern and Western Norway visit the municipality.
The Church of Norway has three parishes (sokn) within the municipality of Lyngdal. It is part of the Lister deanery in the Diocese of Agder og Telemark.
The island of Sælør on the southern coast of the municipality is mentioned in Snorre, as the king Saint Olav spent a winter here in 1028. Based around the port of Agnefest, Lyngdal prospered on maritime trade, and in 1771 an application was made for status as a small coastal town. Its coastal location also facilitated emigration; in the 17th and 18th century largely to the Dutch Republic, and in the 19th century to the United States.
Even before the merger of the municipalities in 1964, the parishes of Austad and Kvås, together with Å (or Aa - Lyngdal proper), made up the greater Lyngdal parish. A census from 1801 showed 3529 inhabitants in the area that today makes up Lyngdal: 1850 in Å, 929 in Austad, 585 in Kvås and 165 in the eastern part of Spangereid. The number today is approximately 8000 inhabitants.
Religious life and missionary work have always had a strong position in Lyngdal, and worthy of special note is the minister and Gabriel Kielland (1796–1854), who served in the parish from 1837–1854, and his wife Gustava (1800–1889). Known today as a missionary pioneer and a popular songwriter, Gustava also wrote one of the first autobiographies by a woman in Norway: her "Reminiscence from my Life" from 1880.
Lyngdal is a coastal municipality that and borders Lindesnes municipality to the southeast, Audnedal to the northeast, Hægebostad to the north, and Kvinesdal and Farsund to the west. Lyngdal municipality includes the southern portion of the Lyngdalen valley which follows the river Lygna to the Lyngdalsfjorden in the south. The Lenesfjorden, Grønsfjorden, and Rosfjorden also are located in the southern part of Lyngdal.
All municipalities in Norway, including Lyngdal, are responsible for primary education (through 10th grade), outpatient health services, senior citizen services, unemployment and other social services, zoning, economic development, and municipal roads. The municipality is governed by a municipal council of elected representatives, which in turn elect a mayor.
The municipal council (Kommunestyre) of Lyngdal is made up of 29 representatives that are elected to every four years. Currently, the party breakdown is as follows:
Bus lines from/through Lyngdal Bus Terminal:Abraham Berge, politician (1851–1936)
Teis Lundegaard, politician (1774–1856)
Trygve Haugeland, politician (1914–1998)
Kjell Elvis, Elvis Presley impersonator (born 1968)
Ingvild Stensland, international women's footballer (born 1981)
Theodore Abrahamson, politician (born 1900)