This Act passed at the Sixty-Second Regular Session of the General Assembly, and was put into effect on March 9, 1901 when Governor Winfield Durbin signed the bill into law.

At the request of the General Assembly, a contest was sponsored by the Indiana Society of the Daughters of the American Revolution to design a flag to serve as the official state banner.

As an incentive to increase the number of submissions, the contest offered the winner a one hundred dollar cash prize.

The entry created by Paul Hadley of Mooresville, Indiana, was ultimately chosen as the winner of the contest and the cash prize.

The General Assembly made only one change to Hadley's original design: they added the word Indiana, in a crescent shape, over the top of the torch.

The field of the flag shall be blue with nineteen stars and a flaming torch in gold or buff.

The flag is required to be flown by all state militias and the Indiana National Guard.

The addition of a seventh ray matches Paul Hadley’s original flag design.

[37] The logo of the BP-acquired Amoco Corporation (formerly Standard Oil of Indiana) prominently features a torch to commemorate the company's Hoosier origins; it remains in use at the few BP stations using Amoco and Standard trade dress to maintain trademark protection.

[38][39] After the Apollo 11 moon landing, a display case containing the state flag and 0.05 grams of space dust was created by NASA and presented to Governor Edgar D. Whitcomb.

Also on this display case, below the rock, is a copy of the state flag that had been carried to the Moon aboard Spacecraft America during the Apollo 17 mission.

At the request of the General Assembly, a contest was sponsored by the Indiana Society of the Daughters of the American Revolution to design a flag to serve as the official state banner.