The state was founded in 1549. Rao Bhagwan Rao, 1st Rao of Datia and Baroni 1626/1656, received Datia and Baroni from his father, Raja Bir Singh Deo of Orchha in 1626, and established his own state. After he died in 1676, the state came under British control with other territories in Bundelkhand under the Treaty of Bassein in 1802. The treaty was formed with the Peshwa. The ancient title of the ruling family was Maharaja Rao Raja, but in 1865 the British Government recognized only the title of Maharaja as hereditary. For the British, the Peshwa maintained a military force consisting of 945 cavalry, 5203 infantry, and 3 million guns.
The motto of the royal family was Wir dalap Sharandah (“Lord of the Brave Army, Giver of Refuge”). In 1896–97, the state suffered from famine, and again to a lesser extent in 1899–1900. After India’s independence in 1947, the Maharaja of Datia acceded the dominion of India, which later merged with the Union of India. Datia, together with the rest of the Bundelkhand agency, became part of the new state of Vindhya Pradesh in 1950. In 1956, the Vindhya Pradesh state was merged with certain other areas to form the state of Madhya Pradesh within the Union of India.