Data-driven studies of identity by descent (IBD) were recently enabled by high-resolution genomic data from large cohorts and scalable algorithms for IBD detection. Yet, haplotype sharing currently represents an underutilized source of information for population-genetics research. We present analytical results on the relationship between haplotype sharing across purportedly unrelated individuals and a population’s demographic history. We express the distribution of IBD sharing across pairs of individuals for segments of arbitrary length as a function of the population’s demography, and we derive an inference procedure to reconstruct such demographic history. The accuracy of the proposed reconstruction methodology was extensively tested on simulated data. We applied this methodology to two densely typed data sets: 500 Ashkenazi Jewish (AJ) individuals and 56 Kenyan Maasai (MKK) individuals (HapMap 3 data set). Reconstructing the demographic history of the AJ cohort, we recovered two subsequent population expansions, separated by a severe founder event, consistent with previous analysis of lower-throughput genetic data and historical accounts of AJ history. In the MKK cohort, high levels of cryptic relatedness were detected. The spectrum of IBD sharing is consistent with a demographic model in which several small-sized demes intermix through high migration rates and result in enrichment of shared long-range haplotypes. This scenario of historically structured demographies might explain the unexpected abundance of runs of homozygosity within several populations.