Sydney was founded in 1785 by Col. Joseph Frederick Wallet Desbarres, but named after Thomas Townshend, 1st Viscount Sydney. At first, Sydney was mainly a mix of poor Englishmen, disbanded soldiers and a group of New York citizens looking to escape the American Revolution. Sydney is in the thick of Cape Breton's industry, once home to the world's largest steel plants, which were fueled by an abundance of coal in the area.

During WWII, the city of Sydney was a key factor for Canada, constructing the Royal Canadian Navy base, HMCS Protector. During the battle of the Atlantic, Sydney's WWII based industry would prove to be a key factor in the Allied victory.

Sydney, on the heels of recent government support, began launching cruise ship facilities, as well, Sydney has a new waterfront plan in order that has made the city a more desirable place to visit. Sydney is also home to the world's largest fiddle. As well, visitors can enjoy diving, golfing, sightseeing and snowmobiling. Sydney is located just 78 km (48.5 mi.) from Baddeck.

Sydney accommodations include plenty of bed and breakfasts, inns and hotels.