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There was a pearl-diving and fishing community at the mouth of Dubai Creek for many centuries, but modern Dubai dates its existence to the 1830s when the Baniyas tribe under the Al-Maktoum family settled there and renounced allegiance to Abu Dhabi. Successive sheikhs encouraged contacts with outsiders, especially the British, who made Dubai a regular port of call.

Dubai has become an important tourist destination, helped by its rapidly-expanding airline Emirates, which is headed by Sheikh Ahmed bin Saeed Al Maktoum, an uncle of the emir. Dubai is also diversifying as a hub for service based industries such as IT and finance, with the new Dubai International Financial Centre or DIFC. The government has set up enclaves and freezones for industry specific corporations. Dubai Internet City, now combined with Dubai Media City as part of TECOM (Dubai Technology, Electronic Commerce and Media Free Zone Authority) is one such enclave and houses IT companies such as EMC Corporation, Oracle, Microsoft and IBM, and media organisations such as MBC, CNN, Reuters and AP.

Dubailand, a proposed entertainment complex, is to include the Mall of Arabia, the largest shopping mall in the world. Dubailand is slated to open in 2006.

A post office of British India was opened August 19, 1909. It used the stamps of India on mail, with postmark "Dubai Persian Gulf", until India's independence in 1947, then stamps of Pakistan until March 31, 1948. Pakistan also becoming independent, the British government set up a postal administration for Eastern Arabia and used overprinted British stamps until January 7, 1961, when Dubai issued its own stamps inscribed "Trucial States". (Despite the name, these were only on sale in Dubai's post office.)

The horse race known as the Dubai World Cup is held annually, and is the world's richest horse race with over US$15,000,000 worth of prize money.

The government's vision to diversify from a trade based, but oil reliant economy to one that is service and tourism oriented, has been conducive to the growth of real estate corporations such as Emaar Properties, and Nakheel. Corporate office enclaves on Sheikh Zayed road were developed to shift Dubai's traditional business area from the creek to the western parts of the city.

Emaar properties is on course to construct the world's tallest building, Burj Dubai. The corporation claims: "Burj Dubai's height is a closely guarded secret but it will beat all records and on a scale that will be a dramatic testament to Dubai's faith in the future."

The first villa freehold properties that were occupied by non-UAE nationals were The Meadows, The Springs and The Lakes, all masterplanned communities designed by Emaar, resulting in luxurious upperclass neighbourhoods collectively known as Emirates Hills. Over the 2005-2006 time frame, most of the freehold skycrapers and other villa projects will be ready for occupation, sparking a new phase in Dubai's history as a city.

Dubai is fairly unique in that its population consists mainly of expatriates, with UAE Nationals (Emiratis) constituting the minority. The vast majority of these expatriates come from the Indian subcontinent and the Philippines. The UAE government does not allow any form of naturalization or permanent residence to expatriates. Even children born in the country are not granted citizenship, unless a parent is a UAE national. Discrimination against Asian expatriates is common. Salaries for lesser qualified citizens are usually several times that of a much higher qualified expatriate. Reports of Emirati employers defaulting on several months salaries are quite common. Expatriates from Western countries however, do not face such discrimination.

Dubai's land-reclamation projects, the Palm Islands The Palm, Jumeira, The Palm, Jebel Ali, The Palm, Deira, and The World will be the world's largest artificial island complexes, developed with villas, golf courses and holiday resorts.

The Dubai Post Department took over the postal service June 14, 1963 and the following day issued a series of stamps depicting sea life, views of Dubai, and Sheikh Maktoum bin Rashid Al Maktoum. This was the opening salvo of a barrage of issue over the next few years; the emirate discovered that stamp collectors were willing to give it money for colored labels with "Dubai" printed on them, and by the time the postal system was merged with that of other emirates, in mid-1972, it had issued over 400 stamps, few of which ever saw usage on mail.

Dubai refers to either one of the seven emirates that make up the United Arab Emirates on the Arabian Peninsula, or that emirate's main city, sometimes called "Dubai City" to distinguish it from the emirate.