The initials IDM appeared in music magazines during the genre's first wave in 1992-1993, but didn't really stick until the formation of the IDM mailing list in August 1993. At that time, the list's focus was the progressive electronic music of Richard D. James, Autechre, and other artists featured on the influential Warp label's Artificial Intelligence compilations. Among these artists were Black Dog Productions (members of which became Plaid) and B12/Redcell.

While mainly British based during the early-to-middle 1990s, IDM spread somewhat in the late 1990s and early 2000s, with a diverse array of styles being combined in new ways by a growing stable of artists across the globe, including the IDM duo Sun Electric from Berlin who were also early pioneers. Lesser-known, but equally influential and highly regarded today, are the artists that were on Kirk Degiorgio's A.R.T. and Op-Art labels, and the Likemind label, including Degiorgio himself under various names (As One, Future/Past, Esoterik), Steve Pickton (Stasis), and Nurmad Jusat (Nuron).

The term "intelligent dance music" is often criticized for not being an actual description of the music genre. Whether or not intelligence or dancing are involved, or whether everybody else's music is stupid, in particular, the name was apparently more memorable than other competing phrases (see: memetic replicator). This is probably due in large part to the high volume of the aforementioned IDM mailing list. Later, Otto Von Schirach aided the replication of the "IDM" meme by mockingly shouting "IDM" repeatedly on the first track of the EP compilation album "Chopped Zombie Fungus". Detractors of the phrase have occasionally used the term "dolphin music" as a disparaging alternative to "intelligent". Rephlex Records refers to IDM as "braindance".

In the late 1990s and early 2000s IDM greatly increased in the United States. One of the more notable areas was Miami, Florida with labels like Schematic, Merck, and The Beta Bodega Coalition sprouting up and releasing artists such as Phoenecia, Dino Felipe, Machine Drum, and Proem. A second would be the Chicago/Milwaukee area with labels such as Addict, Chocolate Industries, Hefty, and Zod releasing artists like Doormouse and Emotional Joystick. The influence of Chicago's adventurous and experimental Wax Trax! label and the use of rhythms drawn from Detroit electro are also obvious in earlier, more linear IDM such as Autechre's "Bass Cadet" (released stateside on Wax Trax) or more recently in their Gescom releases.

Early IDM was produced much like other forms of techno music at the time, using hardware drum machines and rackmounted equipment, possibly all sequenced by MIDI. Since the late 1990s, however, IDM has been primarily produced on computers, using advanced sequencing programs such as Cubase and advanced synthesis programs such as Reaktor and Max/MSP.

The effects processors included with the most popular sound programs cause many IDM groups to use them, unwillingly creating some common features in the genre. One such example is the use of the "sonic decimator" effect, an effect where the sampling rate of a sample can be adjusted in real time, creating a "low fi" effect.

Many contemporary IDM live performances are played entirely on a laptop computer or with a groove box such as the Roland MC-909. In a live performance, the actual amount of "performing" as opposed to "playing back a pre-arranged sequence" varies from artist to artist.