Hjo is known to have had a charter as early as 1413. Hjo is, despite its small population, for historical reasons normally still referred to as a city. Statistics Sweden, however, only counts localities with more than 10,000 inhabitants as cities.
Many wooden towns have suffered fires, but Hjo has been relatively spared, apart from when the church and some adjacent houses burnt down in 1794. The city structure is therefore almost exactly the same as in medieval times.
Hjo works together with the cities of Eksjö and Nora to develop wooden towns as tourist attractions, under the joint name "Three wooden towns" (Tre trästäder).