The name of the town originates from two sources, Mandi was a prefix because it was a grain market and Bahauddin was a Sufi saint.

[3] The town started growing in early 20th century near the ancient village named as Chak No.51, where Sikh, Hindu and Muslim businessmen and land owners came to settle.

Some 8 km northwest of the modern-day Mandi Bahauddin town, at the village Mong on the southern bank of the Jhelum River (Greek Hydaspes), the battle Battle of the Hydaspes River was fought between Raja Porus (Sanskrit Paurava) and (The Great Tribe Chadhar) and Alexander.

This was the last major fight of Alexander's career; the Macedonians, after finding a fierce resistance by Porus, and having heard of a massive 4,000 elephant force mustered by eastern kingdoms, refused to march further toward the Ganges Plains.

Municipal Committee of Mandi Bahauddin Tehsil is subdivided into three tehsils and eighty Union Councils:[8] As per the 1998 Census of Pakistan, the population of city was recorded as 99,496 while at the 2017 Census, the population of city had risen to 198,609 with an increase of over 99.62% in 19 years.

[1][9] The district forms a central portion of the Chaj Doab lying between the Jhelum and Chenab rivers.

It lies from 30° 8' to 32° 40' N and 73° 36' to 73° 37' E. The tehsil headquarters towns of Phalia and Malikwal are 22.5 and 28.5 kilometres (14.0 and 17.7 mi) from Mandi Bahauddin, respectively.