Ratlam princely state was a part of Malwa Agency of Central India. Its capital town was Ratlam and had an area of 1795 square kilometres. Its territory was inextricably intermingled with Sailana boundaries. Its boundaries touch to the territories of the Jaora and Pratabgarh towards north side, Gwalior to the east, Dhar, Kushalgarh and Indore to the south and Banswara to the west side. In 1921, gun salute was increased from 11 to 15 by the British authority. The flag of the state has a rectangular horizontal bicolour of equal bands of green and yellow respectively.
The state was founded by Ratan Singh in 1652. He was the grand-son of Raja Udai Singh of Jaipur and son of Raja Mahesh Das of Jhalor. He had 12 wives, among them Queen Sukhroopde Kanwar Shekhawat Ji Sahiba was the daughter of Kunwar Purshottam Das of Jhajhar in Rajasthan. She became popular for committing sati in 1658.
Ratan Singh was rewarded with a jagir of worth fifty lakh for his brave deeds which favoured Shah Jahan. He was also made commander, granted insignia royalty and granted the title ‘Maharaja’. He died in the battlefield at Ujjain in 1658. He was succeeded by his son, Chhatrasal. State lost fortune with the death of Ratan Singh. Later, the state was split into three parts, Sitamau, Ratlam and Raoti among Kesho Das (nephew of Chhatrasal), Kesri Singh (eldest son of Chhatrasal) and Pratap Singh (youngest son of Chhatrasal) respectively.
In the eighteenth century, the state was conquered by the Marathas and Raja Padam Singh was made to pay tributary to Shindia. Raja Parvat Singh inflicted a war against Sindhia. Hence, Sir John Malcolm intervened and settled the matter by making Ratlam’s chief to pay a tribute of Rs 46,000 to the Sindhia. In 1860, a treaty was made between these triple entities and thereafter a tribute was paid to the British. At the time of Revolt of 1857, rulers of the state supported British. Raja Ranjit Singh was granted with the title of a K.C.I.E. [Knight Commander, one of the ranks of the Order of the Indian Empire] in 1887, and died in 1893.