A market town is a settlement (commonly in Europe) that obtained a market right (by custom or royal charter) in the Middle Ages, which allowed it to host a regular market; this distinguished it from a village or a city. In Britain, small rural towns with a hinterland of villages are still commonly called market towns, and is sometimes reflected in their names (e.g. Downham Market, Market Rasen, or Market Drayton).

https://en.wikipedia.org/wiki/Market_town