The present name of Khammam is said to have been derived from the name of the temple 'Narsimhadri', later 'Stamba Sikhari' and then it was termed as 'Stambadhri'.The vertical rock under the temple is known as 'KAMBA'. The name of the town Khammam seems to have been derived from the name of this hill of Kamba and the district is named as Khammam.

Khammam town which was the seat of Taluk Administration was part of the larger Warangal District, till 1st October, 1953. Five taluks of the Warangal district viz., Khammam, Madhira, Yellandu, Burgampadu and Paloncha (Now Kothagudem) were carved out and a new district KHAMMAM with Khammam as District Headquarters. In 1959 Bhadrachalam Revenue Division consisting Bhadrachalam and Nuguru Venkatapuram Taluks of East Godawari district, which were on the other side of the river Godawari were merged into Khammam on grounds of geographical contiguity and administrative viability.

In 1973 a new taluk with Sathupalli as headquarters was formed carving out from Madhira and Kothagudem taluks. In the year 1976 four new taluks were formed viz., Tirumalayapalem, Sudimalla, Aswaraopeta and Manuguru by bifurcating Khammam, Yellandu, Kothagudem and Burgampadu taluks respectively. In the year 1985, following the introduction of the Mandal system the district has been divided into 46 mandals, in four Revenue Divisions - Khammam, Kothagudem, Paloncha and Bhadrachalam.