Ajaigarh, the town takes its name from the place, Nowgong where the chief resided, at the foot of the hill-fortress. It is around 36 km from the town of Panna and 80 km from the famous town of Khajuraho. The fort located on a steep hill, towers more than 800 ft above the eponymous township, and contains the ruins of a number of temples highlighted with richly engraved sculptures. The rulers bore the title of sawai maharaja. It was the capital of the Chandelas during their decline.

Ajaigarh was the capital of a princely state of the same name during the British Raj. Ajaigarh was established in 1765 by Guman Singh, a bundela Rajput. It was captured by the British in 1809; it became a princely state in the Bundelkhand Agency.

The town was often afflicted by malaria, and suffered harshly from famine in 1868-1869 and 1896-1897.

The state acceded to the Government of India on January 1, 1950; the ruling chief was granted a privy purse and the courtesy use of his styles and titles. All of these were revoked in the year1971 by the government of India. The former princely state became part of the new Indian state of Vindhya Pradesh, and most of the territory of the former state, counting the town of Ajaigarh, became part of Panna District, with a smaller section going to Chhatarpur District.