Marshall was officially organized by William B. Archer in 1835, eight years after the National Road entered the community. The city was named after John Marshall , chief justice of the U.S. Supreme Court. Marshall was incorporated on May 14, 1873.
In 1863, Marshall was the scene of conflict in which local Copperheads , who opposed the Civil War , sought to protect soldiers who had deserted from the Union Army. In March, 1863, an army detail from Indiana arrested several deserters. A local judge, Charles H. Constable , freed the deserters and ordered the arrest of two Union sergeants on kidnapping charges. This resulted in the dispatch of 250 soldiers under the command of Col. Henry B. Carrington by special train from Indianapolis , who surrounded the courthouse, freed the sergeants and arrested judge Charles H. Constable. The judge was, however, absolved several months later after presenting a highly technical defense. 
Marshall was home to the Handy Writers' Colony , 1950-1964. The most famous writer associated with the Colony was the novelist James Jones , who built a home in Marshall and lived there ca. 1952-1957.