This is a history of Independent Games. This is meant as a skeleton structure which can be branched out on in order to fill this wiki.
Indie Game PrehistoryEdit
Very early game development can be considered independent, starting with Space War!, and including many early C64, Amiga, ZX Spectrum, etc. games, but this is not our primary concern here. For practical purposes we'll begin later on.
The business model of most non-freeware indie games is shareware or demoware. This is when part of a game is free, and the rest the player has to pay to get access to. Some DOS games like Commander Keen and Doom used this model: usually the formula was one episode free, and the later two episodes the player had to pay for.
The Era of Isolated Hobbyist Game Engines (1985-2004)Edit
C64 Game Editors (1985)Edit
The first hobbyist game creation tools were for the C64. Pinball Construction Set, Shoot Em Up Construction Set, Adventure Construction Set, The Games Creator by Mirrorsoft, 3-D Construction Kit, and, perhaps most importantly, Activision Gamemaker, also known as Garry Kitchen's Gamemaker. Most of the games created in these tools have been lost, although some collections on the internet remain: the people who created games for these had no good way of trading them amongst themselves or distributing them to others, so most were lost over time. But even today, some are still playable on emulator.
The earliest popular tool which allowed people to create PC games with minimal programming was the ZZT by Tim Sweeny (founder of Epic Megagames), which was not specifically made to be a game engine, but had a level editor so full-featured that it in practice became a game engine. Thousands of ZZT games have been made, and it can be taken to be the nominal start of amateur or hobbyist game development. Although the C64 game editors had various games made in them, there was usually no communication between the people who made those games, so nobody but the creator and their personal friends were able to play them. With the ZZT, there was the early internet, which allowed more communication and community between ZZT-users.
The RPGMaker series started by Japanese developer ASCII are a series of JRPG-creation programs which became popular in the hobbyist game development community; tens of thousands of games have been made in it. Some of the more notable games made in this engine are The Way and Yume Nikki. Perhaps the most well-known game made with this engine is Super Columbine Massacre RPG! that stirred international controversy due to its interactive rendition of the 1999 shooting at Columbine Highschool in Littleton Colorado.
Inform is a family of languages created by Graham Nelson which include an extensive library and world model for the development of interactive fiction. The latest entry, Inform 7 , uses an innovative (if controversial) natural language code syntax.
Clickteam launched Klik & Play in 1994, the first in a line of engines (the latest of which is MMF2). A community formed around it, and many modern indie game developers got their start with Klik & Play, such as Derek Yu and Arthur Lee. MMF2 continues to play an important role, with notable games like The Underside and Knytt Stories using the engine.
Inspired by ZZT, this engine was designed for DOS text-mode games with customized ASCII graphics. Despite this ersatz implementation with limited graphics, it has developed quite a thriving community for nearly 15 years and which still has some outposts of old lovers.
The O.H.R.RPG.C.E. started as a DOS-based RPG-creation program which became popular in the hobbyist game development community; thousands of games have been made in it.
Verge was another RPG engine which eventually was extended to be usable as a general game engine, notable for having a C-like scripting system. In 2007, it had a Lua scripting system added to it. Has a relatively small community due to the relative complexity of making a full game in it. The community is stagnant nowadays, but there are a few people who are still making games with it, and engine occasionally sees updates.
Game Maker (1999)Edit
Game Maker by Mark Overmars is an all-purpose 2D game engine, and has become the most popular game engine for amateurs and hobbyists, with literally hundreds of thousands of games having been made in it, and with many indie developers getting their start in Game Maker before moving to other engines. Game Maker was later bought by YoYo Games. See also: Game Maker developers.
Cave Story and TimW's Great Reunification (2005)Edit
The indie games community was very fragmented, each existing as separate bubble communities; for instance there was the Clickteam community, the Game Maker community, and the Ohrrpgce community, with little cross-pollination or overlap. Typically even the best games made in the engines above wouldn't become popular outside of the people who used that particular engine; i.e. the only people who played the most famous Ohrrpgce games were other Ohrrpgce users. Although the IGF, a yearly independent games contest, started in 1999, the indie games community wasn't unified or even known by that name in those early years.
This changed around 2005, with a series of events. A few major commercial independent developers began promoting themselves explicitly as "indie developers" -- most notably, Introversion, whose catch-phrase was "last of the bedroom programmers", and who had major success in the marketplace with Uplink and Darwinia. Also in 2005, Cave Story was translated by Shih Tzu of Aeon Genesis; Cave Story was an enormously popular game and brought millions of people into the awareness that individuals are still making games on their own, on their own time, games which are often as playable and as high in quality as many mainstream games.
Also around this time, The Home of the Underdogs, an abandonware site that also sometimes covered indie and hobbyist games, stopped being updated. TimW, a fan of indie games in Malaysia, in reaction to that closing decided to start a blog which would cover all major independent game releases. TIGSource, started by Jordan Magnuson, shortly followed suit, and for the first time there were two major blogs about indie games and the indie games community. The TIGSource forums started in 2007, further cementing the community into one place.
Before this time, there was no cohesion to the indie games community, and only much smaller isolated forums and communities existed (the largest of which was probably the Dexterity Forums, which became the Indiegamer Forums. There were also Game Tunnel, which began in very late 2002 / early 2003, started by Russell Carroll of Reflexive which took a 'review crew' or 'Famitsu' approach to scoring indie games, but that site never had as strong of a sense of community, and both that site and the Dexterity forums were almost exclusively focused on commercial shareware indie games, and almost entirely excluded freeware and hobbyist games.
Also during this time, commercial outlets began to welcome indies onboard: Steam, IGN's Direct2Drive, Stardock's Impulse, Microsoft's XBLA and XBLIG, Nintendo's WiiWare, and Sony's PS3 downloadable game service Playstation Network all began to carry indie games regularly. Indie games also became more popular on mobile phones, on the iPhone, and on Flash Portals. This was a large increase in the attention and importance the games industry ascribed to independent game creation.
Fracturing: "New Wave" Indies and Art Games (2007)Edit
Indie developers are of course not uniform, and there are different schools of thought as to what indie games are or should be about. Out of the indie game community arose an informal group of indie developers mockingly called "New Wave Indie" by Derek Yu which have no defining doctrine but which generally believe in ideas and experimentation above tradition and polished graphics.  Examples may (or may not) include Auntie pixelante, Increpare, Tale of Tales, Jason Rohrer, and others. In response to Yu's characterization of this sub-group formed a term for its opposite: GDC Indies, which are indies who want to make games similar to the ones the mainstream makes, rather than indies who want to break away and explicitly reject many of the standards and traditions of the mainstream games industry.
Basically, the difference is New Wave indies generally hate or are bored by what mainstream games are doing, and want to take games in a totally new and different directions never before taken, often by experimenting and by rejecting standard conventions, whereas GDC indies love games of all kinds, even mainstream games, and don't have as strong of a dislike for the traditions and practices of the mainstream games industry, and tend to make games essentially similar to the mainstream games in style, basic framework, and gameplay (although not always lacking in innovation).
The term Art Game is a controversial term, and refers to a game which aspires to artistic value (in some form), rather than merely being a tool for pure enjoyment and fun. The earliest example of an explicit art game may be La La Land or The Marriage by Rob Humble, but other prominent Art Games include The Path, The Graveyard, Passage, and Gravitation. Many indie developers are vehement in their opposition to the existence of art games; with Derek Yu even having to write an article for TIGSource on why art games have a place on TIGSource, defending art games from written attacks by a developer of the mainstream game God of War and from a Destructoid columnist.