Hamtramck was originally settled by German farmers, but Polish immigrants moved into the area when the Dodge Brothers plant opened in 1914. Poles previously made up a large proportion of the population. It is sometimes confused with Poletown, a traditional Polish neighborhood, which used to lie mostly in the city of Detroit and includes a small part of Hamtramck. As of the 2010 American Community Survey, 14.5% of Hamtramck's population is of Polish origin whereas in 1970 it was 90% Polish.

Circa the 1920s and 1930s, people had bars active and publicly made them visible, which was against Prohibition.

Over the past thirty years, a large number of Muslim immigrants from the Middle East (especially Yemen), South Asia, and the Balkans have moved to the city. As of the 2010 American Community Survey, the city's foreign born population stood at 41.1%, making it Michigan's most internationally diverse city (see more at Demographics below). The population was 43,355 in the 1950 Census and 18,372 in 1990.

Hamtramck was primarily farmland, although the Detroit Stove Works employed 1,300 workers to manufacture stoves. In 1901, part of the township incorporated as a village to gain more control over the settlement's affairs, and by 1922 the village was reincorporated as a city to fend off annexation attempts by the neighboring city of Detroit. By the mid-1920s, 78% of the residents of Hamtramck owned their own houses or were buying their houses. Around that time, the factory workers made up 85% of Hamtramck's heads of households. Of those factory workers, about 50% were categorized as not skilled workers. In 1910, the newly founded Dodge Main assembly plant created jobs for thousands of workers and led to additional millions of dollars in the city. Dodge Main quickly expanded and became important to Hamtramck. Before the construction of Dodge Main, Hamtramck was a largely rural town. The establishment of the Dodge Main assembly plant led to a large influx of Polish immigrants who pushed out the incumbent German politicians. It was after this that Hamtramck was considered a Polish-American town.

By the end of the 20th century and the closing of Dodge Main, followed closely by General Motors razing of key parts of the Polish neighborhoods, the ethnicity of the region quickly shifted from traditionally Polish descendants to new Middle Eastern and South Asian immigrants. By the elections of 2015, the city is suggested to have been the first to elect a Muslim-majority council in the country.

In November 2021, Hamtramck elected a completely Muslim-American city council and a Muslim mayor, becoming the first municipality in the United States to be governed entirely by Muslim-Americans. In June 2023, the city drew scrutiny for its ban of the rainbow flag on city property and perceived homophobia.

According to the United States Census Bureau, the city has a total area of 2.090 square miles (5.41 km), all land.

Hamtramck is mostly surrounded by Detroit except for its small common border with the city of Highland Park, which is in turn also mostly surrounded by Detroit. Hamtramck lies about 5 miles (8 km) from the center of Detroit. The I-75 freeway roughly runs along this city's western border, and I-94 runs near its southern border.

According to Keith Matheny of the Detroit Free Press, the urban layout assists recent immigrants who do not yet have the credentials to drive an automobile, as Hamtramck is "uniquely walkable" and a "tight size".

As of the 2020 census, there were 28,433 people, 8,139 households, and 5,661 families residing in the city. The population density was 13,604.3 inhabitants per square mile (5,252.6/km). There were 8,911 housing units. The racial makeup of the city was 55.9% White (people of European, Middle Eastern and North African descent), 10.0% African American, 0.1% Native American, 26.9% Asian, 0.0% Pacific Islander, 1.0% from some other races and 6.0% from two or more races. Hispanic or Latino of any race were 1.1% of the population. 32.6% of residents were under the age of 18, 9.1% were under 5 years of age, and 7.4% were 65 and older.

As of the 2010 census, there were 22,423 people, 7,063 households, and 5,115 families residing in the city. The population density was 10,751.0 inhabitants per square mile (4,151.0/km). There were 8,693 housing units at an average density of 4,159.3 per square mile (1,605.9/km). The racial makeup of the city was 53.5% White, 19.2% African American, 0.2% Native American, 21.5% Asian, 0.6% from other races, and 4.7% from two or more races. Hispanic or Latino of any race were 1.4% of the population.

There were 7,063 households, of which 43.2% had children under the age of 18 living with them, 40.3% were married couples living together, 18.1% had a female householder with no husband present, 7.0% had a male householder with no wife present, and 34.7% were non-families. 28.9% of all households were made up of individuals, and 9.2% had someone living alone who was 65 years of age or older. The average household size was 3.09 and the average family size was 3.98.

The median age in the city was 28.8 years. 31.7% of residents were under the age of 18; 12.2% were between the ages of 18 and 24; 27.9% were from 25 to 44; 20.7% were from 45 to 64; and 7.7% were 65 years of age or older. The gender makeup of the city was 51.6% male and 48.4% female.

As of the 2000 census, there were 22,976 people, 8,033 households, and 4,851 families residing in the city. The population density was 10,900.5 per square mile (4,208.7/km), making it the most densely populated city in Michigan. There were 8,894 housing units at an average density of 4,219.6 per square mile (1,629.2/km). The racial makeup of the city was 60.96% White (which includes people of Middle Eastern ancestry), 15.12% African American, 0.43% Native American, 10.37% Asian, 0.10% Pacific Islander, 1.14% from other races, and 11.89% from two or more races. Hispanic or Latino of any race were 1.31% of the population.

In the 2000 census, major ancestry groups reported by Hamtramck residents were as follows:

• Bangladeshi 19.7%
• Pakistani 11.0%
• Polish 10.9%
• Arab (excluding Iraqi and Lebanese) 9.2%
• Macedonian 5.5%
• Indian 5.4%
• Black or African American 5.1%
• Ukrainian 3.2%
• Albanian 2.8%
• Irish 2.2%
• German 1.9%
• Italian 1.8%
• Russian 1.4%
• English 1.1%
• French (excluding the Basques) 0.8%
• Lebanese 0.7%
• Scottish 0.7%
• Iraqi 0.5%
• Yugoslav 0.5%
• Mexican 0.2%

3.1% of Hamtramck's population reported Albanian ancestry. This made it the second most Albanian place in the United States by percentage of the population, second only to Fairview, North Carolina.

There were 8,033 households, out of which 33.3% had children under the age of 18 living with them, 37.3% were married couples living together, 16.1% had a female householder with no husband present, and 39.6% were non-families. 32.2% of all households were made up of individuals, and 13.3% had someone living alone who was 65 years of age or older. The average household size was 2.74 and the average family size was 3.59.

In the city, the population was spread out, with 27.8% under the age of 18, 10.8% 18 through 24, 31.9% 25 through 44, 17.7% 45 through 64, and 11.9% who were 65 years of age or older. The median age was 32 years. For every 100 females, there were 110.4 males. For every 100 females age 18 and over, there were 109.6 males.

The median income for a household in the city was $26,616, and the median income for a family was $30,496. Males had a median income of $29,368 versus $22,346 for females. The per capita income for the city was $12,691. About 24.1% of families and 27.0% of the population were below the poverty line, including 36.9% of those under age 18 and 18.1% of those age 65 or over.

From the 1990 census to the 2000 census, the city's population increased by 25%. Sally Howell, author of "Competing for Muslims: New Strategies for Urban Renewal in Detroit", wrote that this was "overwhelmingly" due to immigration from majority Muslim countries.

From 1990 to 2000, of all of the municipalities in Wayne, Oakland, and Macomb counties, Hamtramck had the highest percentage growth in the Asian population. It had 222 Asians according to the 1990 U.S. Census and 2,382 according to the 2000 U.S. Census, an increase of 973%.

Historically, Hamtramck received a lot of immigration from Eastern Europe. In the 20th century, Hamtramck was mostly Polish. George Tysh of the Metro Times stated that "In the early days of the auto industry, Hamtramck's population swelled with Poles, so much so that you were more likely to hear Polish spoken on Joseph Campau than any other tongue." Later waves of immigration brought Albanians, Bosnians, Macedonians, Ukrainians, and Yemenis. By 2001 many Bangladeshis, Bosnians, and Iraqi Assyrians were moving to Hamtramck. As of 2011 almost one in five Hamtramck residents was Asian (excluding those from South-west Asia). As of 2003, over 30 languages are spoken in Hamtramck and more than four religions are present. The four principal religions are, Islam, Christianity, Hinduism and Buddhism.

In June 2013, the city's Human Relations Commission facilitated the raising of flags of 18 countries from which Hamtramck residents emigrated. They are displayed on Joseph Campau Street, with an American flag flying at either end.

In the 1930s, the first group of Bengalis came to Detroit and Hamtramck. The first significant population of Bengalis began arriving in the late 1980s and the Bengalis became a large part of the city's population in the 1990s. The largest growth occurred in the 1990s and 2000s. By 2001 many Bangladeshi Americans had moved from New York City, particularly Astoria, Queens, to Hamtramck and the east side of Detroit. Many moved because of lower costs of living, larger amounts of space, work available in small factories, and the large Muslim community in Metro Detroit. Many Bangladeshi Americans moved into Queens, and then onwards to Metro Detroit.

In 2002, over 80% of the Bangladeshi population within Wayne, Oakland, and Macomb counties lived in Hamtramck and some surrounding neighborhoods in Detroit. That area overall had almost 1,500 ethnic Bangladeshis. Almost 75% of Bangladeshi Michiganders live in Hamtramck.

By 2002, a Bengali business district formed along Conant Avenue and some residents called it "Little Bengal". The district, along Caniff and Conant streets, included markets, stores, mosques, and bakeries owned by Bangladeshis, Indians, and Pakistanis. By 2008 the Bengali business district, between Davison and Harold Street, and partially within the city limits of Detroit, received the honorary title "Bangladesh Avenue" and was to be dedicated as such on November 8, 2008. Akikul H. Shamin, the president of the Bangladesh Association of Michigan, estimated that Bangladeshi people operate 80% of the buildings and businesses in the portion of Conant Avenue. As of February 2008 the city planned to erect signage reading "Bangladesh Town" in the business district.

In 2002, the estimate of Hamtramck inhabitants of origins from South Asia was from 7,000 to 10,000. As of 2001, 900 registered students who spoke Bengali and Urdu attended Hamtramck Public Schools. Most Bangladeshis in Hamtramck originate from the north-eastern region of Sylhet in Bangladesh; therefore, most speak Sylheti.

As of 2014, there are over 13 Bengali clothing shops in the city.

As of 2006, most of the Middle Eastern population in Hamtramck is Yemeni. Hakim Almasmari wrote in 2006 that "Several streets seem to be populated exclusively by Yemeni Americans, and Yemeni culture pervades the city's social, business, and political life." Many Yemeni restaurants are in Hamtramck, and the Yemeni community operates the Mu'ath bin Jabal Mosque (Arabic: مسجد معاذ بن جبل), which was established in 1976. In 2005 the mosque, located just outside the southeastern border of Hamtramck, was the largest mosque out of the ten within a three-mile radius. Sally Howell, author of "Competing for Muslims: New Strategies for Urban Renewal in Detroit", wrote that the mosque "has been credited" by public officials and area Muslims "with having turned around one of Detroit's roughest neighborhoods at the height of the crack cocaine epidemic of the 1980s, making its streets safe, revitalizing a dormant housing market, attracting new business to the area, and laying the foundation for an ethnically mixed, highly visible Muslim population in Detroit and Hamtramck."

According to Almasmari, some of the first Yemenis to have arrived in Hamtramck said that Yemeni people first arrived in Hamtramck in the 1960s. The "Building Islam in Detroit: Foundations/Forms/Futures" project of the University of Michigan stated that Yemenis began arriving in the 1970s.

In 2013 Dasic Fernandez, a Chilean artist, created a 90-foot (27 m) by 30-foot (9.1 m) mural on the Sheeba restaurant celebrating the Yemeni population. The mural depicts a girl in a veil decorated with the blue sky, a farmer wearing a turban, and a woman in a hijab. The Arab American and Chaldean Council and the coalition OneHamtramck commissioned the mural.

In the 2000s, a Bengali mosque named the Al-Islah Jamee Masjid asked for permission to broadcast the adhan, the Islamic call to prayer, from loudspeakers outside of the mosque, and requested permission to do so from the city government. It was one of the newer mosques in Hamtramck. Sally Howell, author of "Competing for Muslims: New Strategies for Urban Renewal in Detroit", wrote that the request "brought to a head simmering Islamophobic sentiments" in Hamtramck. Muslims and interfaith activists supported the mosque. Some anti-Muslim activists, including some from other states including Kentucky and Ohio, participated in the controversy. In 2004, the city council voted unanimously to allow mosques to broadcast the adhan on public streets, making it one of a few U.S. cities to do so. Some individuals had objected to the allowing of the adhan due to noise concerns.

In 2023, the Hamtramck city council approved animal slaughtering in households for Muslim religious purposes.

On June 13, 2023, the city council introduced a resolution prohibiting the display on city property of all flags but the American flag and “nations’ flags that represent the international character of City,” which many interpreted as an indirectly targeted ban of the rainbow flag on city property and sidewalks, which had previously been the source of controversy among some residents. Following three hours of public comment, the council passed the resolution unanimously. Mayor Amer Ghalib opposed displaying the pride flag, but former mayor Karen Majewski had supported displaying it. The council also voted to remove two commissioners of the Hamtramck Human Rights Commissioner for flying the rainbow flag. The move was criticized by senator Stephanie Chang, U.S. representatives Shri Thanedar and Rashida Tlaib, and Detroit mayor Mike Duggan.

In response to a decision by the city council, multiple activist groups organized into a coalition opposing the flag restrictions. The founding group consisted of individual activists, AntiTransphobe Detroit, Michigan General Defense Committee, and the Hamtramck Queer Alliance. Notable speakers at the event were Dana Nessel, Rev. Strickland, Grace of AtA, and Josh of HQA.

Hamtramck is governed under a council-manager form of government in which the elected mayor of the city is the chief executive officer. The city council consists of six seats. Though part of the council, the mayor is elected separately and votes only in the case of a tie and on ordinances and contracts. The city council hires a city manager, who becomes the city's chief administrative officer. The city manager has the vested powers and responsibility to appoint and remove all city employees and department heads, prepare the city's budget, and other city functions.

The current Hamtramck City Hall is a former hospital building. In 1927, the Hamtramck Municipal Hospital, housed in a Georgian Revival building, opened. The mayor of Hamtramck asked the Sisters of Saint Francis to operate the hospital. In 1931, the religious order began leasing the hospital from the city government for $1 per year. The hospital was renamed the Saint Francis Hospital. During its lifetime it offered services to Polish speakers. In 1969, the hospital closed and the building became the city's city hall.

In November 2015, Hamtramck became the first American city to elect a Muslim-majority city council. In 2022, it became the first American city to have an all-Muslim government. It also now has an all male elected government which has been said to "not reflect the city's makeup." The Wayne County Jail Division operates the William Dickerson Detention Facility in Hamtramck. The city levies a city income tax of 1 percent on residents and 0.5 percent on nonresidents.

Hamtramck is served by Hamtramck Public Schools. Hamtramck High School is the public high school of Hamtramck. In addition Hanley International Academy, Frontier International Academy, Hamtramck Academy, Bridge Academy (of the Global Educational Excellence (GEE) company), Caniff Liberty Academy and Oakland International Academy are all charter schools, in Hamtramck. Frontier International Academy, a charter school operated by GEE, is in nearby Detroit.

Hamtramck was historically a Polish Catholic community, so it housed Catholic schools by the Roman Catholic Archdiocese of Detroit. One of the buildings once used by Hanley charter school was previously St. Florian Elementary School. The other Catholic primary schools included Our Lady Queen of Apostles and St. Ladislaus Elementary School. The city also housed St. Florian High School, a Catholic high school which opened in 1940 and was located in another wing of the same building as St. Florian.

The parishes that established St. Florian, Our Lady Queen of Apostles, and St. Ladislaus had been built after 1909. In 1925 2,217 students attended St. Florian, making it the largest Catholic elementary school in the city. That year, St. Ladislaus had 1,540 students, and Our Lady Queen of Apostles had 1,316 students. JoEllen McNergney Vinyard, author of For Faith and Fortune: The Education of Catholic Immigrants in Detroit, 1805-1925, wrote that the classrooms were "more crowded than most any Polish parish school in Detroit." In the Catholic schools in Hamtramck there were often 70 students per classroom compared to 45 students per classroom in Hamtramck public schools. It was common for children to attend religious schools selectively during certain periods so they could absorb religious ideals, but go to public school for preschool and later stages. In the 1920s Hamtramck had no Catholic high school and the majority of parents sent their children to public high school. Felician Academy and St. Josephat's Polish Catholic High School, two schools in Detroit, were located several blocks away from the Hamtramck border. Some parents sent their children to those schools.

In 1992 Dickinson West Elementary School opened in the former St. Ladislaus building. In the fall of 2002, St. Florian High and Bishop Gallagher High School in Harper Woods merged to form Trinity Catholic High School in Harper Woods. At that point, St. Florian Elementary remained open. In 2005 the archdiocese announced that St. Florian Elementary would close. After St. Florian Elementary's closing, no Catholic schools are located within the city limits of Hamtramck. During the same year, the archdiocese announced that Trinity High School would close.

In the 1920s Hamtramck families often sent their children to public school for kindergarten due to convenience, then moved their children to parochial schools for the years with the most important religious instruction. Therefore, the age group 7 to 12 had the largest Catholic school enrollment. After the critical period ended, many students returned to public school. In 1925 the public schools had 1,467 students aged 14–15 while the non-public schools had 217 students aged 14 and 15. In the early 1920s the annual growth rate of Hamtramck Public Schools buildings were 27% while non-public schools had an annual growth rate of 6% in that period.

In the 1920s there was a high level of school dropout in Hamtramck. During the decade Hamtramck had three 12th-grade students per 100 5th-grade students while the City of Detroit had 21 12th-grade students per 100 5th-grade students. In the 1920s 58% of 16-year-olds and 85% of 17-year-olds in Hamtramck were no longer attending high school. One public school survey stated that in 1924-1925 65% of male school dropouts began working in factories.

Hamtramck Public Library Albert J. Zak Memorial is located at 2360 Caniff. The Tau Beta Association founded the library in November 1918. The library opened at its second location, the second floor of a professional building, on November 14, 1938. In 1951 the City Hall branch opened in the first floor of the municipal building; it was dedicated on January 22, 1952. The current library received its groundbreaking ceremony on July 5, 1955. It was completed on May 31, 1956, and dedicated on July 1, 1956.