The consulate was housed in a building leased from Frans August Larson, and opened on 1 April 1921, the same year of the communist revolution of 1921.

The first consul appointed to Kalgan, Samuel Sokobin, visited Ulaanbaatar and met with prime minister Dogsomyn Bodoo several times, who wrote an article for The Nation magazine in November 1921.

Another prime minister with ties to the United States was Soliin Danzan, who represented the "American-Mongolian automobile company".

After contacts between diplomats in Tokyo and New York, 1986 the Mongolian ambassador to the United Nations Gendengiin Nyamdoo and US Deputy Assistant Secretary of State for East Asia J. Stapleton Roy met and exchanged notes on a diplomatic framework for recognition and relations, agreeing on a date for formal establishment of ties.

The documents were signed by Nyamdoo and U.S. Secretary of State George Shultz in the White House Treaty Room.

[6] The U.S. Embassy in Ulaanbaatar was established in April 1988, with the first U.S. ambassador to Mongolia Richard L. Williams presenting his credentials to Mongolian chairman Jambyn Batmönkh in September 1988.

Mongolia was granted permanent normal trade relations (NTR) status and Generalized System of Preferences (GSP) eligibility in June 1999.

Agriculture Secretary Mike Johanns led a presidential delegation in July 2006 in conjunction with Mongolia's celebration of its 800th anniversary.

In July 2007, six members of the U.S. House of Representatives visited Mongolia to inaugurate an exchange program between lawmakers of the two countries.

In September 2007, the White House announced the proposed creation of an Asia-Pacific Democracy Partnership, in which Mongolia was invited to take part.

In August 2011, on a side trip while traveling to China and Japan, Joe Biden made the first visit by a sitting vice president to Mongolia since 1944.

[12] Mongolia delivered 60,000 pieces of personal protective equipment to the Navajo Nation in 2020, this becoming the first non-stop flight between the two countries.

[13] In early 2021, it was found in a declassified secret document that Mongolia holds a strategic importance to the US in advancing the Indo-Pacific region.

The monetized proceeds of the food aid ($4.2 million in 2006) are currently used to support programs bolstering entrepreneurship, herder livelihood diversification, and better veterinary services.

[26][27][28] By the end of the compact in September 2013, the Government of Mongolia and MCC had spent 94 percent of the anticipated compact funds to increase land security, reduce impacts of non-communicable diseases and injuries, provide enhanced vocational training, expand distribution of energy-efficient household products, and construct roads for commercial traffic.

[34] The two countries jointly participate in two annual military exercises hosted in Mongolia, Khaan Quest and Gobi Wolf.