The town was named for the Federalist Party that met there in 1812, and was incorporated in 1823. Another source maintains Federalsburg was so named because it was settled by people from northern states.
Geography
Federalsburg is located at . According to the United States Census Bureau, the town has a total area of, of which is land and is water.
As of the census of 2010, there were 2,739 people, 1,081 households, and 708 families living in the town. The population density was. There were 1,191 housing units at an average density of. The racial makeup of the town was 53.8% White, 41.0% African American, 0.3% Native American, 0.8% Asian, 1.3% from other races, and 2.8% from two or more races. Hispanic or Latino of any race were 3.6% of the population. There were 1,081 households of which 41.0% had children under the age of 18 living with them, 31.8% were married couplesliving together, 26.9% had a female householder with no husband present, 6.8% had a male householder with no wife present, and 34.5% were non-families. 29.3% of all households were made up of individuals and 11.5% had someone living alone who was 65 years of age or older. The average household size was 2.53 and the average family size was 3.10. The median age in the town was 33.3 years. 30.8% of residents were under the age of 18; 9.5% were between the ages of 18 and 24; 24.3% were from 25 to 44; 23.1% were from 45 to 64; and 12.5% were 65 years of age or older. The gender makeup of the town was 45.2% male and 54.8% female.
2000 census
As of the census of 2000, there were 2,620 people, 1,045 households, and 714 families living in the town. The population density was 1,341.5 people per square mile. There were 1,130 housing units at an average density of 578.6 per square mile. The racial makeup of the town was 58.93% White, 36.83% African Americans, 0.31% Native American, 0.65% Asian, 0.04% Pacific Islander, 0.38% from other races, and 2.86% from two or more races. Hispanic or Latino of any race were 1.11% of the population. There were 1,045 households out of which 37.1% had children under the age of 18 living with them, 38.4% were married couples living together, 25.0% had a female householder with no husband present, and 31.6% were non-families. 27.3% of all households were made up of individuals and 13.8% had someone living alone who was 65 years of age or older. The average household size was 2.51 and the average family size was 2.97. In the town, the age distribution of the population shows 30.8% under the age of 18, 9.7% from 18 to 24, 26.0% from 25 to 44, 19.4% from 45 to 64, and 14.2% who were 65 years of age or older. The median age was 33 years. For every 100 females, there were 81.8 males. For every 100 females age 18 and over, there were 74.9 males. The median income for a household in the town was $24,266, and the median income for a family was $32,059. Males had a median income of $28,438 versus $21,296 for females. The per capita income for the town was $13,878. About 21.0% of families and 25.3% of the population were below the poverty line, including 35.2% of those under age 18 and 18.2% of those age 65 or over.
