The municipality was created in 1971, when the City of Vetlanda (instituted in 1920) was amalgamated with the surrounding rural municipalities to form a unitary municipality. In 1863, when the first local government acts in Sweden came into force, there were more than 20 entities within the area of the present municipality.
Vetlanda Municipality is the largest municipality in Jönköping County. The municipality is situated on the South Swedish highlands, an area situated some 250 meters above sea level and also includes Eksjö Municipality and Nässjö Municipality. It is a sight worthy nature that is visited by tourists for the scenery alone.
The distance to any of the three largest Swedish cities Malmö (south-west), Gothenburg (west) and Stockholm (north-east) is rather similar; about 300 km.
The history of Vetlanda goes back to at least the medieval age when it was the seat for the regional assembly called þing (thing). According to the imaginations of Petter Rudebeck (1660–1710), Vetlanda was before that known as Vitala, and the centre of a mythological kingdom. However, all later archeological research have failed in finding any evidence of it. But the myth was popular during the 18th and 19th century, which displays in the naming of several companies and locations around the municipality.