It has two Evangelical churches, that of St. Lawrence being a fine Gothic structure, a 16th-century town-hall; a very old hospital and an agricultural school. In the 19th Century its industries embrace the manufacture of felt, boots and metal wares.
Pegau grew up round a monastery founded in 1096, but does not appear as a town before the close of the 12th century. Markets were held here and its prosperity was further enhanced by its position on a main road running east and west. In the monastery, which was dissolved in 1539, a valuable chronicle was compiled, the Annales pcgevienses, covering the period from 1039 to 1227.