According to the United States Census Bureau, the city has a total area of 1.7 square miles (4.3 km²), of which, 1.3 square miles (3.4 km²) of it is land and 0.3 square miles (0.9 km²) of it (20.48%) is water. Dayton is located within Kentucky's Bluegrass region in the Upper South of the United States of America.
Dayton has a large sandbar, just off its shore. It had a popular beach for many years known as the "Manhattan Bathing Beach", until the US Army Corps of Engineers raised the level of the Ohio River. Laws were passed prohibiting nude swimming in the Ohio River during daylight hours, and prohibiting dogs from running loose. Violators of the nude swimming law faced a penalty of a $1.00 fine for the first offense, and could go as high as $5.00 for subsequent offenses. People also had the right to shoot dogs that were running loose in the city, and bill the owners for carcass removal.
Floods in 1884, 1913 and 1937 - the latter affecting 80 percent of the city and prompting residents to take shelter in the garages of the former Wadsworth Watch Case Co. - caused many of the companies in the once-booming town to move elsewhere. By the 1950s, many residents, weary of constant flooding, moved out of the town as well.
Today Dayton is working on downtown revitalization and a historical survey of the city, it is the first step toward creating a historic district in the city.
There were 2,200 households out of which 35.2% had children under the age of 18 living with them, 45.3% were married couples living together, 18.0% had a female householder with no husband present, and 31.0% were non-families. 25.5% of all households were made up of individuals and 10.6% had someone living alone who was 65 years of age or older. The average household size was 2.69 and the average family size was 3.24.
In the city the population was spread out with 28.2% under the age of 18, 11.9% from 18 to 24, 29.8% from 25 to 44, 19.5% from 45 to 64, and 10.6% who were 65 years of age or older. The median age was 32 years. For every 100 females there were 96.1 males. For every 100 females age 18 and over, there were 92.0 males.
The median income for a household in the city was $32,008, and the median income for a family was $38,339. Males had a median income of $28,592 versus $21,048 for females. The per capita income for the city was $15,373. About 15.2% of families and 16.3% of the population were below the poverty line, including 24.4% of those under age 18 and 4.7% of those age 65 or over.