As a terminus of a narrow-gauge railway running 80 km (50 miles) north of Raipur on the main Bombay-Calcutta line of the Bengal Nagpur Railway, Dhamtari became a trade centre.
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It is bordered by the Raipur District to the north, the Kanker and Bastar Districts to the south, the State of Orissa to the east and the Durg and Kankar Districts to the west.
Dhamtari district was officially formed on 6 July 1998 dividing the Raipur district currently the capital of Chhattisgarh along with Mahasamund.