It was one of the largest and wealthiest princely states existing alongside British India, with wealth coming from the lucrative cotton business as well as rice, wheat and sugar production.

In their early years, the Gaekwads served as subordinates of the Dabhade family, who were the Maratha chiefs of Gujarat and holders of the senapati (commander-in-chief) title.

As a result, the Gaekwads, along with several other powerful Maratha clans, established themselves as virtually independent rulers, while recognizing the nominal authority of the Peshwas and suzerainty of the Bhonsle Maharaja of Satara.

On 15 March 1802, the British intervened to defend the Gaekwad Maharaja, Anand Rao Gaekwad, who had recently inherited the throne against rival claimants, and the Gaekwads concluded the Treaty of Cambey with the British that recognized their independence from the Maratha Confederacy and guaranteed the Maharajas of Baroda local autonomy in return for recognizing British suzerainty, though it was a result of an inability to overpower them.

Gaekwad or Gayakwad also survives as a fairly common Maratha surname, found mainly in the Indian state of Maharashtra.