Dillsburg is surrounded by Carroll Township in northwestern York County, Pennsylvania. According to the United States Census Bureau, the borough has a total area of 0.8 square miles (2.1 km2), all of it land.
The town is named for Matthew Dill, an immigrant from County Monaghan, Ireland, who settled the town in 1740. The village became a center for local agriculture.
As of the census of 2000, there were 2,063 people, 902 households, and 579 families residing in the borough. The population density was 2,600.7 people per square mile (1,008.3/km²). There were 936 housing units at an average density of 1,180.0 per square mile (457.5/km²). The racial makeup of the borough was 97.19% White, 0.48% African American, 0.44% Native American, 1.21% Asian, and 0.68% from two or more races. Hispanic or Latino of any race were 0.29% of the population.
There were 902 households, out of which 30.3% had children under the age of 18 living with them, 50.1% were married couples living together, 10.8% had a female householder with no husband present, and 35.7% were non-families. 31.8% of all households were made up of individuals and 14.7% had someone living alone who was 65 years of age or older. The average household size was 2.29 and the average family size was 2.89.
In the borough, the population was spread out with 24.6% under the age of 18, 7.6% from 18 to 24, 31.2% from 25 to 44, 22.2% from 45 to 64, and 14.5% who were 65 years of age or older. The median age was 37 years. For every 100 females there were 87.2 males. For every 100 females age 18 and over, there were 81.2 males.
The median income for a household in the borough was $37,530, and the median income for a family was $46,797. Males had a median income of $42,235 versus $21,995 for females. The per capita income for the borough was $19,801. About 7.5% of families and 6.3% of the population were below the poverty line, including 9.6% of those under age 18 and 6.4% of those age 65 or over.
Dillsburg's Farmers' Fair celebration is held annually during the third weekend in October. Among the many attractions are the Halloween parades on Friday and Saturday evenings, the classic car and farm tractor parade Saturday afternoon, and Civil War reenactments at the nearby Dill Tavern. A wide variety of food can be found, from common concessions to specialty theme items such as fried pickles and pickle soup.