town and borough (district), administrative and historic county of Shropshire, western England, bordered on three sides by Wales. Oswestry lies in a scenic setting in the foothills of the Berwyn Mountains between Wat's Dyke (c. 700) and Offa's Dyke (c. 784), defensive earthworks formerly separating England and Wales. “Old” Oswestry, an Iron Age hill fort with complicated defenses reflecting a long history, stands 1 mile (1.6 km) from the town.

Oswestry is thought to derive its name from Oswald (Oswald, Saint), king of Northumbria, who was killed by Penda, king of Mercia, in 641 at the Battle of Maserfelth (or Maserfeld), probably near the present town. The scene of much border warfare between the Welsh and the English, the town was twice burned to the ground in the Middle Ages. On Castle Bank are the ruins of a castle built by Madog ap Maredudd, Welsh king of the adjacent region of Powys.

A grammar school was founded in Oswestry town in 1407 and was moved to larger premises in 1776, but the old building still stands. For centuries Oswestry has been a market centre for Welsh goods, especially wool. The modern town has a large cattle market and light industry. Aside from the town of Oswestry, the borough is mostly rural. Area 99 square miles (256 square km). Pop. (2001) town, 16,660; borough, 37,318.