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Baldock was founded by the Knights Templar (also the name of the town's secondary school) in the 1140s. Perhaps for this reason, one theory of the origin of the name Baldock is as a derivation from the Old French name for Baghdad: Baldac which the Templars had hoped to conquer during the crusades. Other theories include that the name is derived from "Bald Oak", meaning a dead oak. The modern layout of the town, and many buildings in the centre, date from the sixteenth century, with the earliest dating from the fourteenth century.
The town grew up where the old Great North Road and the Icknield Way crossed. Despite the construction of the A1(M) motorway in 1970, which bypassed the town (and which was called the Baldock Bypass for some years), it was still a major traffic bottleneck until March 2006, when a new bypass removed the A505 road (old Icknield Way) from the town.
Due to its location, the town was a major staging post between London and the north: many old coaching inns still operate as pubs and hotels, and Baldock has a surprising number of pubs for its size. From the 1770s until 2008 the high street was very wide, a typical feature of medieval market places where more than one row of buildings used to stand. In the case of Baldock, the bottom of the High Street had three such rows, until Butcher's Row was demolished by the Turnpike authorities in the 1770s. In late 2008, a town centre enhancement plan included a narrowing of the road and subsequent widening of paved areas.