Originally called Sheepscot Plantation, Newcastle was first settled in the 1630s by fishermen and around 50 families. The village of Newcastle is located in the eastern part of the town, on the Damariscotta River. Together with the village of Damariscotta, linked by the Main Street bridge, they form the Twin Villages.

The Newcastle Historical Society's museum, located in the old historic Tanscot Engine House on Main Street, is filled with artifacts and historical memorabilia. The Sheepscot Historic District includes 51 buildings in the Italianate, Greek Revival, and Federal styles. Nearby Great Salt Bay is a wonderful example of natural conservation.

The 540-acre Dodge Point Public Reserved Land boasts 8,000 feet of shoreline along the Damariscotta River. Newcastle is a beautiful setting for hiking, cross-country skiing, fishing, or a nice quiet walk.