Archaeological excavations suggests there has been a city on the site since at least the Age of Darkness.
Khornthises was killed by a small group of adventurers and the city liberated, but quickly taken over by a human mage. Mages ruled the city until the end of the wars, when it was conquered by Eieber.
Life Under Dragon Rule
Although a major trade center on the Agras Plain, Khornth is still most famous for its time under the tyranny of a fallen dragon. Sources dating to the Golden Age typically paint Khornthises as having ruled only through fear and intimidation, and regularly feasting on his subjects. However, contemporary accounts reveal that he was actually a fair - if very strict - leader, and that many of his subjects were thankful to live under him.
While Khornthises himself lived a very decadent life, he was also careful to see to it that his subjects had plenty to eat, even using dragon magic to improve the yield of their crops to some extent. He also organized a powerful army and personally trained human wizards to man the city's Mage Tower.
The city had a strict but thorough set of laws, and for its era was probably one of the fairest legal environments in the region. Everything hinged upon "The One Rule", which stated very simply "The Law is to be applied to all humans equally, male, female, young, old, citizen, or visitor, regardless of any difference or inequality". Essentially, everyone was to be tried the same.
Strikingly, there were no jails in Khornth; criminals were punished by indentured servitude. More serious offenses might be worthy of banishment, while the most heinous crimes were punished by death. The method of execution was always the same: Khornthises would eat you. This is the only documented situation in which he ate his subjects, and this being the height of the Mage Wars, it did happen quite frequently.