Caledon is known as the 'Capital of the Overberg'. The town of Caledon owes its origin to the hot water springs on the slopes of the Klein Swartberg. The early Khoi-Khoi people discovered the springs long before Europeans came to the Cape. Only after Europeans settled in the Cape, the Caledon springs became increasingly famous. Actual development started in 1710 when Ferdinand Appel secured a grant of the area on condition that he built a house to accommodate the sick.

The hot springs at Caledon became popular and were developed as the years passed, with a variety of shelters and accommodation erected for the convenience of visitors. The Caledon Casino, Hotel & Spa is today the main attraction for visitors to Caledon, seeking an opportunity to relax, unwind and indulge in the refreshing country atmosphere of South Africa's oldest hot springs resort.

Seven springs of chalybeate (iron rich) water originally bubbled to the surface, one of which was cold and the other six thermal. The water, in contact with rocks heated by pressure deep under the ground, is warmed to a steady temperature of 49, 5°C, with 909 000 liters reaching the surface each day. As with the 73 other know hot springs of Southern Africa, the thermal springs of Caledon are not related to volcanic activity. The principal feature of the water, besides its warmth, is that it's free of any organic matter and has a large amount of iron in solution. Samples of Caledon's mineral spring water were submitted in 1893 to the greatest exhibition of the time, the Chicago World Fair. The water was awarded first prize as one of the world's top quality mineral waters.

The second major asset of Caledon is the world-renowned wild flower garden and reserve. The 56 ha garden is notable for its wonderful variety of indigenous flowers, superb examples of one of the richest flora in the world. Caledon is also well-known for its wheat fields, barley, onions and wool. Southern Associated Maltsters have in the town the largest malt-producing plant in the Southern Hemisphere. The malting factory processes 140 000 tonnes of barley annually. A wild flower show is held every September and a Beer and Bread Festival in March.

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