The origins of Slightly Mad Studios trace directly to Blimey! Games, a developer that had previously worked on the GTR series of racing simulators. On January 12, 2009, Ian Bell acquired the business and assets of Blimey! Games from its bankrupt parent company, 10tacle Studios, and reconstituted the team as Slightly Mad Studios.
The studio operated with a distributed development structure — developers worked remotely from locations across the world — a relatively uncommon approach in 2009. This model allowed the studio to recruit specialist talent without geographic constraint. Slightly Mad was ranked 17th in the Develop 100 list of most successful developers for 2010.
The studio's first major release under the Slightly Mad name came in September 2009: Need for Speed: Shift, published by Electronic Arts. The game focused on the driving simulation side of street racing rather than the arcade style of earlier Need for Speed titles. Its sequel, Shift 2: Unleashed, was announced in November 2010 and released in March 2011.
In 2012, Slightly Mad released Test Drive: Ferrari Racing Legends, a game dedicated to Ferrari's motorsport history across Formula One, rallying, and sports car racing.
The studio's defining work came in 2015 with Project CARS, a community-funded and community-developed racing simulator. The game was built using pre-alpha funding and crowd-sourced testing from a community of enthusiast drivers, allowing Slightly Mad to bypass conventional publisher advances. The title was featured in professional esports competitions organized by the ESL from 2015 to 2018.
Project CARS 2 followed in 2017, expanding the original's content and physics with additional cars, tracks, and a more detailed dynamic weather system. The Madness engine used for Project CARS 2 was subsequently licensed to Reiza Studios for use in Automobilista 2, announced on May 25, 2019, with that game releasing in June 2020.
Project CARS 3 was released on August 28, 2020, three weeks after the studio's publisher also launched Fast & Furious Crossroads. A free-to-play mobile spin-off, Project CARS Go, was developed for release by Gamevil in March 2021, but was withdrawn from sale in October 2021 and its online services shut down in November of that year.
On January 2, 2019, CEO Ian Bell announced via Twitter that Slightly Mad Studios was developing its own video game console, to be called Mad Box. Bell described it as "the most powerful console ever built," claiming it would run games at 4K resolution at up to 120 frames per second and support major virtual reality headsets at 60 frames per second per eye. The company stated the console would be performance-equivalent to a high-end PC two years into the future, with a planned release around 2022, and that the proprietary game engine would be made freely available to developers. The Mad Box was never released.
In November 2019, Codemasters acquired Slightly Mad Studios for approximately US$30 million, including the rights to the Project CARS series and an unannounced project in development. Codemasters was itself acquired by Electronic Arts in February 2021.
In October 2021, Ian Bell departed the studio. Under Electronic Arts' ownership, Project CARS and Project CARS 2 were removed from digital storefronts in 2022 as licenses for the tracks and cars depicted in the games expired. On November 8, 2022, EA announced that the Project CARS series would be discontinued and that affected Slightly Mad Studios staff would be moved to other projects within the EA portfolio. Bell subsequently established a new company, Straight4, and publicly offered employment to affected Slightly Mad staff.