(See also Santee Agency)

Founded in 1873, the agency became home for a group of Santee who left the Santee Agency in Nebraska. Following the 1862 uprising in Minnesota (an attack on white settlers caused by forced reservation life and broken treaty promises) the Santee were moved first to Crow Creek Agency in Dakota, then to Santee Agency in northern Nebraska. In 1879 Flandreau Agency was consolidated with the Santee Sioux Agency in Nebraska even though the people remained in Dakota.

Those Santee who established the colony at Flandreau were Christian Indians who homesteaded their lands pursuant to article VI of the Fort Laramie treaty of 1868. Article VI provided that Indians could take homesteads and become citizens and still retain the benefits provided to them by the treaty. Among the early settlers were Jacob Eastman (father of Charles Eastman) and Thomas Wakeman (the son of Little Crow, a leader of the Minnesota Uprising).

Today the open land base of the Flandreau Agency is 2,356 acres in Moody County in southeastern South Dakota near the Minnesota border. Flandreau Indian boarding school is still maintained by the Bureau of Indian Affairs.