The Firth of Tay provided a natural deep-water harbour at Dundee. In the 18th century the production of linen made from local flax became an important industry in the area. By 1793 the first steam-driven mills were being built in the town.
In the late 1820s flax became scarce and manufacturers began using jute. The first jute carpeting was produced and demand for this new product increased rapidly. Dundee also began to produce textile machinery for its own needs and for export.
Some of the first railways in Scotland were built in the Dundee area. The Dundee & Newryle was opened in 1831. This was followed by the Dundee & Arbroath (1840) and Dundee & Arbroath (1847) and a line to Aberdeen was added in 1849.
Shipbuilding became important in the 19th century and a special dock was made for the construction of Captain Scott's Discovery. The Firth of Tay was bridged in 1878 but it collapsed in December 1879. William Arrol was given the job of building its replacement.
The population of Dundee was 26,000 in 1801 and reached 63,000 in 1841, 90,000 in 1861 and 140,000 in 1881.
On the northern banks of the Tay is Dundee, a pleasant, large, populous city, and well deserves the title of Bonny Dundee. It is one of the best trading towns in Scotland. A great quantity of corn is sent from here to England and Holland. They also have a good share of the Norway trade. They also send ships to Sweden, and import iron, copper, tar, pitch, etc. from the several trading ports of that kingdom.