It was a breakaway realm of the Dúnedain kingdom of Arnor. After the death of its tenth King Eärendur, his sons divided the kingdom into the kingdoms of Arthedain, Rhudaur and Cardolan.
Amlaith founded Arthedain and a younger son (Eärendur had many sons so his name or order of birth are unknown) founded Cardolan.
When the kingdom of Angmar appeared in northern Eriador, Cardolan became the most important ally of Arthedain. It had to fight the combined armies of both Angmar and Rhudaur (which turned a vassal of Angmar when it appeared).
Eventually around 1409 T.A. the kingdom was destroyed, but its former inhabitants accepted the King of Arthedain as their lord.
The name Cardolan appears to be Sindarin for "Red Hill Land".