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In keeping with India's vision to become a world leader in Science and Technology and to usher in a new revolution, resulting in an unprecedented economic growth, Government of India reassessed the need of technical manpower and decided to set up eight new Indian Institutes of Technology (IITs). Six of these started functioning from the Academic Year 2008-09. These were established at Hyderabad, Gandhinagar, Rajasthan, Ropar, Patna and Bhubaneswar.

IIT Indore and IIT Mandi started functioning from July 2009. Indian Institute of Technology Indore, located in Madhya Pradesh, is an Institute of national importance. Institute functions under the Ministry of Human Resource Development, Government of India. In the beginning the Institute started functioning under the mentorship of IIT Bombay.

At present the Institution is operating independently from two of its temporary campuses at Institute of Engineering and Technology (IET) of Devi Ahilya VishwaVidyalaya and another at Pithampur Auto Cluster Limited (PACL), Mhow. The permanent campus of the Institute is being developed at Simrol, 25 km from the city of Indore.