Arnold Town was formed in 1989 by a merger of Arnold F.C. and Arnold Kingswell, adopting the yellow of Arnold and the blue of Kingswell as club colours. The new club took over from Arnold in the Central Midlands League Supreme Division, finishing third in their first season. The 1992–93 season saw the club win the Notts Senior Cup, beating Rainworth Miners Welfare 3–1 in the final, as well as winning the Supreme Division, earning promotion to Division One of the Northern Counties East League. They went on to win Division One at the first attempt, earning promotion to the Premier Division. The 1994–95 season saw them finish second in the Premier Division and win the President's Cup.
In 1995–96 Arnold won the Notts Senior Cup for a second time after beating Boots Athletic 2–0, The following season saw the same two clubs contest the final, with Arnold winning 1–0. A fourth Cup was won in 1998–99 with a 2–1 win over Hucknall Town, and a fifth came in 2004–05 when Eastwood Town were beaten 1–0. In 2012–13 the club finished 19th in the Premier Division following a 10-point deduction due to financial problems and were relegated to the East Midlands Counties League. In 2018–19 they finished bottom of the East Midlands Counties League and were relegated to the Central Midlands League South Division.