During the 1960s, there were many municipal mergers across Norway due to the work of the Schei Committee.

[9] The municipality (originally the parish) is named after the old Sandstad farm (Old Norse: Sǫndulfsstaðir).

The last element is the plural nominative case of staðr which means "place" or "abode".

At the time of the municipal dissolution, it was part of the Hitra prestegjeld and the Sør-Fosen prosti (deanery) in the Diocese of Nidaros.

The municipal council (Herredsstyre) of Sandstad was made up of 15representatives that were elected to four year terms.