Ira Haning, a Free Will Baptist minister, persuaded Nehemiah and Permelia Atwood, affluent residents and entrepreneurs, to use their wealth to establish a college.

Following Nehemiah's death in 1869, the responsibility for making this dream a reality fell to his wife Permelia.

In 1873, Permelia Ridgeway Atwood established an endowment and deeded 10 acres (4.0 ha) of land for Rio Grande College, which officially opened on September 13, 1876.

The university is a member of the National Association of Intercollegiate Athletics (NAIA), primarily competing in the River States Conference (RSC; formerly known as the Kentucky Intercollegiate Athletic Conference (KIAC) until after the 2015–16 school year) since the 2014–15 academic year; which they were a member on a previous stint from 1964–65 to 1970–71.

Rio Grande competes in 26 intercollegiate varsity sports: Men's sports include baseball, basketball, bowling, cross country, football, golf, rugby, soccer, track & field (indoor & outdoor), volleyball, and wrestling; while women's sports include basketball, bowling, cross country, golf, rugby, soccer, softball, track & field (indoor & outdoor), and volleyball; and co-ed sports include bass fishing, cheerleading, dance, and eSports.