Theni district was formed from bifurcation of erstwhile Madurai district, as per GO Mrs. No. 679 Revenue Department dated 7 July 1996. As a result of bifurcation, a new Revenue Division was also established with headquarters in Uthamapalayam and two new Taluks in Theni and Bodinayakanur. established with effect from 1 January 1997. The municipal town of Theni was only a headquarters of Firka until 31 December 1996. As a consequence of the formation of the new district, the municipal town of Theni became Taluk and district headquarters on January 1, 1997.
The region covered by the present-day Theni district was sparsely populated before the 20th century. In 1886, the Mullaperiyar Dam Project bought some of the water from the Periyar River downhill to the Cumbum Valley and merged it with the Mullayar River. This project helped more people settle in Cumbum Valley. It is also worth noting that Theni itself was a small but lesser-known town in the 20th century. After the Mullai-Periyar merger project, many people from nearby arid areas (Sivakasi, Kovilpatti, Virudhunagar, Sattur and several nearby villages) settled in the Cumbum valley (present-day Theni district). So there was an influx of people between 1890 and 1920. Bodi and Periyakulam were famous places at that time. Subsequently, Theni developed rapidly through trade.
