The University of Southern Indiana Foundation was organized in 1968 as the official gift-receiving agency for the University. As an Indiana not-for-profit corporation, its principal functions were established to promote, receive, invest, and disburse charitable gifts for the benefit of the University.

Its organizing committee included Mayor Frank F. McDonald Sr., Joseph E. O'Daniel, John E. McCutchan, E. Donald Elliott, Kenneth Jack Hahn, Richard E. Meier, and Evansville campus officers, David L. Rice, Byron C. Wright, and Donald D. Bennett. These organizers received strong community support from industrialists Robert L. Koch and D. Mead Johnson, Indiana State University President Alan Rankin, and West Side business leaders H. Byron Hubbard, William J. Moutoux, and L. Bernard Powers.

Over the next 17 years, major accomplishments of the Foundation's Board of Directors included establishing the Century Club as the first gift club, spearheading a fund drive to provide needed books for the Library, attracting the school's first scholarships, and raising capital dollars to purchase spectator seating in the basketball arena and to furnish the University Center, and in 1982, building and furnishing the finest home for a university president in the State of Indiana.

The USI Foundation's total assets have grown from $609,594 in 1985 to over $77.5 million in 2011, and scholarship assets from $235,382 to $40.8 million in 2011. Charitable gifts in support of the University, which in 1985 totaled $500,000, reached $5.9 million at June 30, 2011.