The town was founded in late medieval times by a widow called Salushe. She built a rest stop called Hani i Salushes on the road from Durrës to Berat and Fier, giving birth to the town. As of 2000, old men still called the town Salushe. Lushnje is the only town in Albania founded by a woman.
In January 1920, Lushnje was a provisional capital of Albania and the place of the Congress of Lushnje. Chieftains of Albania assembled in the town and declared Tirana first a provisional and then the definitive capital of Albania.
The Lushnje region is known as a main provider of agricultural products to the rest of the country. It is one of very few field districts of mountainous Albania.
During the Communist Regime the town had a number of factories: among them food processing and building materials, which were closed down for one reason or another in the aftermath of the fall of Communism. Stadium of Lushnje Abdurrahman Roza Haxhiu was the only stadium in the country where women were soccer fans as much as men were, and attended the soccer matches. This shows that the town was exceptionally liberal, peaceful and emancipated. Unfortunately that tradition has expired, and now Lushnje resembles all the neighboring towns.
3 km away from Lushnje is the Savra Field. This field is on the Lushnje-Fier road. Here the first battle between Principality of Zeta and Ottoman Empire occurred in 1385 (the Battle of Savra). In this battle Balsha II was killed. Along with Fier, Lushnje was the main district of the concentration camps during the Communist Regime; some of the camps included the villages of Savër, Gradishtë, Bedat, Gjazë, Rrapëz, Plug, etc.
Data from the 1918 census shows that the population of Lushnja was split almost evenly between Muslims and Christians at the time of independence from the Ottoman Empire. The Christians are mostly Orthodox, but there is a Catholic minority, while similarly the Muslims are mostly Sunni with a Bektashi minority. In modern days, like elsewhere in Albania, people in Lushnja tend not to be very religious if religious at all, regardless of whatever religion their ancestors professed.
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