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The growing volume of holiday mail became so substantial that it caught the attention of Robert Ripley in 1929, who featured the town's post office in his nationally syndicated Ripley's Believe It or Not! The town's name caught the attention of Vincennes, Indiana entrepreneur Milt Harris.

He created Santa's Candy Castle, the first tourist attraction in Santa Claus, Indiana, which is also purported to be the first themed attraction in the United States.

Several town meetings were held, during which the name Santa Claus was selected.

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Many residents also live in Holiday Village, a subdivision on the north side of town.

Santa Claus is the home to numerous themed attractions including: Santa's Candy Castle, Santa Claus Museum, Holiday World & Splashin' Safari, Frosty's Fun Center, Christmas Lake Golf Course, and Santa's Stables.

In 1993, it became Holiday World & Splashin' Safari when a water park named Splashin' Safari was added to the park.

Still owned and operated by the Koch family, it attracts more than one million visitors annually, and it is home to The Voyage, which has repeatedly been voted by coaster enthusiasts as the number one wooden roller coaster in the world.

Santa Claus has grown substantially since the 1990 census, which recorded 927 residents.

A majority of Santa Claus residents live within the gated community of Christmas Lake Village, which was developed in the late 1960s by Bill Koch.

Santa Claus Town attractions included a red-brick Candy Castle, sponsored by Curtiss Candy and dedicated December 22, 1935, and the Toy Village, a series of miniature fairytale buildings sponsored by prominent national toy manufacturers.

Santa Claus Town led to the creation of the town's first newspaper, The Santa Claus Town News, and the Santa Claus Chamber of Commerce.

Every year, the post office also creates a special Christmas hand-cancellation pictorial postmark for use during December, which also attracts mail from all over the world.

The pictorial postmark is chosen each year from submissions from art students at nearby Heritage Hills and South Spencer High Schools.

The town was established in 1854 and known as Santa Fe (pronounced "fee").

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