Pelugo sits in the beautiful, majestic environment of the Val di Borzago. A natural setting of snow-capped peaks and green forests that give it its name: “Pelugo” in fact originates from 'Penes Lucum' meaning “In the sacred forest”.
The Municipality of Pelugo is located near the start of the Borzago Valley that climbs up to the Lares and Carè Alto glaciers. The village was rebuilt after being destroyed by the fire of 4 March 1922.
The plain to the southern-east of the village was the locality of the farmsteads of Arena, named as far back as 1364, and apparently destroyed by the Bedù river in flood. Legend has it that they were burned by Charlemagne. The village, in fact, dates back a very long way and was dominated by the ancient fortification of San Zeno. The activities that flourished in the area included timber and silk, wrought iron (forges were sited on the Bedù) and walnut oil production. Construction and timber processing are important elements in today’s economy.