The Sindarin name for the dense wood that grew out from the northern foothills of the White Mountains near the eastern end of that range. The wood stretched along the mountains for some forty miles, from the Beacon-hill of Nardol in the west as far as the isolated height of Amon Dîn in the east, with the hill of Eilenach rising from the trees in the middle of the forest. Eastward of the main stretch of trees was a smaller wood, separated from the main mass of Tawar-in-Drúedain, that was named the Grey Wood.

Soon after the first rising of the Sun, a people of Men came out of the East and entered this wood. These were Drúedain, Wild Men of the Woods, thought to have been the first of Men to cross Anduin into the western lands of Middle-earth. These people settled beneath the trees of the forest, and from them it took its name. So it became known as Tawar-in-Drúedain, the 'forest of the Drúedain', a name commonly translated as the Drúadan Forest. (Drúadan being simply the singular form of plural Drúedain). Not all of these Wild Men remained in the forest, and many passed on farther westward and northward, but many others chose to remain.

The migrations of the Drúedain belonged to the distant past, and by the end of the Third Age these people were almost unknown in Middle-earth. At that time it was thought that those who remained beneath the trees of Tawar-in-Drúedain were the last of their kind to survive. They were ill-treated, and even hunted, by the Men who lived in the lands around, but nonetheless they remained enemies of Sauron, with a hatred of the Orcs deeply rooted in their history.

The Drúedain that gave the forest its name played their part in history during the War of the Ring. On 13 March III 3019 the Rohirrim, hurrying to join the defence of Minas Tirith, found that their way eastward was blocked by a waiting enemy force. They entered Tawar-in-Drúedain to be greeted by the drums of its people, and eventually by the headman Ghân-buri-Ghân. Ghân's people still remembered an ancient path through the mountains, the old Stonewain Valley made perhaps three thousand years earlier, and agreed to lead the Riders of Rohan onto that secret road. Thus the Rohirrim were able to reach Minas Tirith and turn the tide of its Siege.

After the War, the new King Aragorn Elessar of Gondor recognised the contribution of the Wild Men of Tawar-in-Drúedain. He made them a free people within his realm, protecting the forest and banning other Men from entering it unless the Drúedain wished them to do so. Though Tawar-in-Drúedain had long been thought to hold the last remnant of the Drúedain in Middle-earth, others were later found dwelling in the shorelands far to the west, in a place named Drúwaith Iaur that, like Tawar-in-Drúedain, took its name from the Drû-folk who dwelt there.