In the early 19th century, Vandalia became the western terminus of the National Road from the East Coast.

The townsite, located in Bond County at the time,[5]: 5  was hastily prepared for the 1820 meeting of the Illinois General Assembly.

Another suggestion was made for the term dalia, derived from the Anglo-Saxon word dale which means a valley between hills.

Greenup takes credit in the conversation for connecting the two terms to form the name Vandalia.

The Vandalia colony was named in honor of Queen Charlotte, who claimed descent from the Wendish tribe of Obodrites, also called the Vandals.

Another theory put forth is that Vandalia was named by those who located the state capital in the town; according to the story, they mistakenly thought the Vandals were a brave Native American tribe, rather than of Germanic origins.

[6][7] The law under which Vandalia was founded included a provision that the capital would not be moved for twenty years.

[9] On November 21, 1915, the Liberty Bell passed through Vandalia on its nationwide tour, while being returned to Philadelphia, Pennsylvania from the Panama-Pacific International Exposition in San Francisco.

[6][10] In the early 1960s the sociologist Joseph Lyford examined the social structure of Vandalia in a book-length study that revealed the essentially corporatist nature of decision-making in the city; this work was recently revisited by the Economist newspaper.

It also serves vocational students from nearby high schools such as those in Greenville and Mulberry Grove.