Chestnut Hall was built for John McDonagh, a lumber merchant who served as Reeve of the Village of Thorold from 1871 to 1874 and Mayor of the Town of Thorold from 1881 to 1884. John McDonagh's widow left the house to St. John's Anglican Church, which used it as a manse for a few months before selling it in 1920 to the Great War Veterans' Association, which is known today as the Canadian Legion. Chestnut Hall has also housed the former Town of Thorold Municipal Offices and the Regional Health Department. As of 2015, the hall is the home of the Thorold and Beaverdams Historical Society and the Thorold Museum as well as forming part of the Thorold Public Library.

The main section of this building is two storeys high with a bay window of the first floor extending to an open porch on the second floor. There are five different sections in the house, indicating that additions were built at various times. The rear addition has interesting arched windows which are very different from those in the main part of the house.