It is famous for an over-700-year-long tradition of growing Saaz noble hops used by several breweries. Žatec produces its own beer and hosts 'Dočesná', its (hops related) harvest festival every year on the town square.
During and after the Second World War a Messerschmitt production facility and air base for testing aircraft, including new jet fighters, was located close to the town. In 1948 the production facility continued to produce the Avia S-199, a version of the Messerschmitt Bf 109 aircraft which were sold to Israel, with the initial training for the Israeli pilots provided at the air base. Many other military supplies were flown to Israel from the air base, which helped the new state to secure its independence.