The title of the air comes from the name of the county located in Northern Ireland. The air was collected by Jane Ross of Limavady, County Londonderry, who heard it played by an itinerant piper or fiddler. The descendants of blind fiddler Jimmy McCurry assert that he is the musician from whom she transcribed the tune but there is no historical evidence to support this speculation.

Ms. Ross submitted the tune to music collector George Petrie, and it was then published by the Society for the Preservation and Publication of the Melodies of Ireland in the 1855 book The Ancient Music of Ireland, which Petrie edited. The tune was listed as an anonymous air, with a note attributing its collection to Jane Ross of Londonderry. This led to the descriptive title "Londonderry Air" being used for the piece. The title "Air from County Derry" or "Derry Air" is sometimes used instead of "Londonderry Air", due to the Derry-Londonderry name dispute.

The origin of the tune was for a long time somewhat mysterious, as no other collector of folk tunes encountered it, and all known examples are descended from Ms. Ross’ submission to Petrie’s collection. In a 1934 article, Anne Geddes Gilchrist suggested that the performer Ross heard played the song with extreme rubato, causing Ross to mistake the time signature of the piece for common time (4/4) rather than 3/4. Gilchrist asserted that adjusting the rhythm of the piece as she proposed produced a tune more typical of Irish folk music.