Trade directories have been published for over 200 years - but the earliest ones related to the cities. Over the years their role and geographical cover have expanded - and smaller towns and specialist occupations developed their own. A Guide to the National and Provincial Directories of England and Wales excluding London published before 1856 was written by Jane E Norton and published in 1950 and I have used extracts from this as a guide. Some may be very difficult to find - while others may now be available as reprints or on microfilm. Definitely some are listed in the library catalogue at familysearch so will be available through LDS Family History Centres.
The important thing to remember is that, unlike the census returns, trade directories are selective and only some people are listed. Initially they would only list the principal tradesmen of the town, and coverage of the more rural areas was neglected, except for the country seats of the gentry. However as time went by the amount of detail, and the number of entries, increases. However, until you come to the comprehensive street directories, where they exist, the average poorer household would not be listed. Another problem is the dating of the directory. Some directories are not clearly dated and the supposed date may be an estimate based on the information it contains. Not only will there be a delay between collecting the information and printing the directory but the same information may be used in later editions. However none of the Hertfordshire county directories were updated every year - so entries can only be used for approximate dates that someone was trading.
In addition to including many names, the directories also contain information on the towns and villages they cover - in some cases in surprising detail - particularly towards the end of the 19th century.
The following pages contain descriptions of various types of trade directories, with Hertfordshire examples:
Early National Directories
Pigot's Directories from 1823
Kelly's Directories from 1845
Other County Directories
Directories of Individual Towns
The Hertfordshire Almanac
LDS Directory Holdings for Hertfordshire
There are other lists associated with named places which can be be useful - such as poll books and electoral registers. In addition there are a wide variety of professional and specialist directories which list suitably qualifies people by their occupation. There are also many volumes, such as Burke's Peerage, Debrett's Baronetage, etc, which document the upper echelons of society, often detailing many generations. The Society of Genealogists has a very good collection of specialist directories - and others may be available on microfilm through the LDS, or on CD from organisations such as archiveCDbooks.
See LAVERS, Hemel Hempstead, from late 19th century for a worked example of how directories can help to reconstruct the history of a firm over a period of about 140 years.
In addition there are a number of gazetteers which describe the towns and villages - for example:
Topographical Dictionary of England, 1831
The Little Guides: Hertfordshire, 1903 & 1957
See Willian for a comparison of the entries for a small village
A very useful web site is the Digital Library of Historical Directories
If you can add to the information given above tell me.