Žagarė is a town on the border between Lithuania and Latvia and it dates back to 12th century (probably 1198) as a settlement by Semigalians, an ancient Baltic tribe. The Svete River divided Žagarė into two distinct administrative units: the Old Žagarė and the New Žagarė that were joined later into one town. The Jewish community of Old Žagarė was one of the first in Lithuania that was founded as early as 16th century. The Jewish community of New Žagarė was founded in the beginning of 18th century. According to the census of 1766, there were 840 Jews in Old Žagarė and 313 in New Žagarė. In 1814, the first pharmacy was opened. There was a new beit midrash. The market area was paved in 1803. In 1850 count Naryshkin received control over Žagarė and held it until the World War I.
In the 19th century, Žagarė became one of the first centers of the Haskalah movement in Russia and gained renown as a "town full of scholars and scribes". One of the main "scholars of Žagarė" was Hayim Zak. Still, the majority of Jews remained faithful to tradition and two yeshivot existed in the two parts of Žagarė. In 1847, the Jewish population was 2266. In the 1897 census, the Jewish population was 5443 (68% of the total).
In the beginning of the 20th century, the Jews were engaged in craft, trade and rising vegetables. There were button, ribbon, brush, rope and candle manufacturers as well as beer and mead breweries. During the 1905 uprising, locals overthrew the Russian Tsarist administration and formed the "Lithuanian Republic of Žagarė" which lasted for two weeks until the arrival of a detachment of Cossacks.
During the World War I the community declined. In 1915, thousands ran away by the government order and arrived in Berdyansk a port city on the Azov Sea, Russia. After the World War I, with the formation of the independent Lithuania, Žagarė was split between Old and New Žagarė by a border agreement with Latvia. In the 1923 census, the Jewish population was 1928 (41% of the total). Many of the Jews immigrated to USA, South Africa and Palestine. Between that time and Soviet occupation in Jume 15, 1940, there were several pray houses, two synagogues, a Yavneh school (with about 135 students), kindergarten, large library, many charitable institutions, a home for the aged (Bikur Cholim), and a Jewish Peoples Bank. Before the Holocaust, there were about 1000 Jews in Žagarė.
A few days after the German attack on the Soviet Union (June 22, 1941), the whole of Lithuania was in German hands. Shortly after, the Žagarė ghetto was set up, in which Jews from neighboring localities (Linkovo, Kurshan, Krok, Popilan, Radvilishkis, Yaneshok, Zaimol, etc) were also interned. On Yom Kippur day (October 2, 1941), the inhabitants of the ghetto were murdered in the market place and in Naryshkin park.