In 1886, Nottingham Forest donated a set of red kits to Dial Square, the first incarnation of the club known today as Arsenal FC.
Two former Nottingham Forest players, Fred Beardsley and Morris Bates, moved to London to work in the Royal Arsenal, an armaments factory in Woolwich, London. Upon meeting other football fans while they were there, they decided to form a football club. This club was christened Dial Square after the workshop they were employed in by the factory. Beardsley and Bates arranged a kit donation (Dial Square couldn't afford to buy their own at this time) from their former team Nottingham Forest. The kits that arrived were dark red (the same as Forest's) and since then Arsenal has kept these colors as a tribute to the donation.
As the club began to expand beyond the confines of the factory the name changed, first to Royal Arsenal and then to Woolwich Arsenal. Upon moving to the club's new stadium in Highbury in 1913, the club dropped "Woolwich" from its name and became known simply as Arsenal.
Arsenal joined the Football Association in 1893, becoming the first southern club to do so, and playing in the second division initially - until a controversial promotion in 1919. Since that promotion Arsenal FC have never been relegated and as a result hold the English record for the longest stretch in the top flight of football.
The kit has been updated over time to become a brighter red color, but in their commemorative year during the 2005/06 season, Arsenal adopted the dark red shirts once more.