The village of Khilchipura was established more than 600 years ago by King Allauddin Khilji. The city of Mandsaur located 3 kilometers away was the main center while Khilchipura functioned as a small 'subedar'. Mandsaur was earlier called Marhsaur. The name was derived from names of two places 'Marh' and 'Saur' which might have been merged to form this town. It was also said to be called Dashapura when it was ruled by the Dasharnas during the Mahabharata period. Bandhuvarma was one of the rulers in this dynasty, who appears in an inscription at Mandsaur. The silk workers had constructed a Sun temple here which was repaired by Bandhuvarma in Samvat 493 (436 CE).
The Risthal stone slab inscription discovered in 1983 has brought to light the Aulikara dynasty, which succeeded the Dashapura dynasty. Two monolithic pillars were erected in a small village called Sondani (4km from Mandsaur) by a king called Yashodharman of this dynasty in 528 AD. These described his exploits and achievements.The Indian Archaeology Department records that these are excavated from the original site in Sondani.
Before Independence in 1947, Mandsaur was part of the princely state of Gwalior. It lent its name to the treaty made with the Holkar Maharaja of Indore which helped put an end to the Third Anglo-Maratha War and the Pindari War in 1818. Later as it neared the 20th century, it became a thriving centre for the Malwa opium trade.
Khilchipura lying in Mandsaur District forms the northern projection of Madhya Pradesh from its western Division, i.e., Ujjain Commissioner's Division. It lies between the parallels of latitude 230 45' 50' North and 250 2' 55' North, and between the meridians of longitude 740 42' 30'East and 750 50' 20' East.
The District is bound by two Districts namely Neemuch in the north-west and Ratlam District in the South. The District is an average sized and extends for about 142 km. from north to south and 124 km from east to west.
The climate of this district is generally dry except in south-west monsoon. Year may be divided in to four seasons. The cold season is from December to February. This is followed by the hot season from March to the middle of June. Thereafter the south west monsoon season starts and continues up to the middle of September. In the district there is rapid increase in temperatures after February. May is generally the hottest month with the mean daily maximum temperature at 39.80 C. and the mean daily minimum at 25.40 C. Days are intensely hot in summer and hot dust-laden winds blow during this season adding to the discomfort. On individual days in the summer season and in June before the onset of the , the day temperatures often reach above 450 C. January is the coldest month with the mean daily maximum temperature at 35.00 C and mean daily minimum at 9.30 C. The average annual rainfall in the District is 786.6 mm.
Malvi is the language mostly spoken in Khilchipura and is a mix of Rajasthani and Hindi languages. The culture has the influence of Malwi culture and Malwi language is comonly spoken, which is a mix of Rajasthani and Gujarati. All Muslim and hindu festivals are celebrated with gaiety.
Most of the people in Khilchipura are Muslims. There are, however, sizeable minorities of Hindus and Jains. Hindi language is the main language. Agriculture is the main occupation and the others include trade and crafts. Many people from the tribal background are, nowadays, found to be working as factory workers, as shopkeepers or as street hawkers in nearby city Mandsaur.
Female population of the village indulge in weaving when their husbands are away on fields.
Majority of the male community wear kurta pyjama or pant shirts along with. Women are usually seen in salwar suits, hindu women adorn sarees too.
Khilchipura is famous for the Pashupatinath temple with its eight-faced 'Shiv Ling'. Hordes of devotees flock to the temple to attend the 'Mela' or fair held in the temple. The water in the 'Shivna River' swells every monsoon and touches the bottom of the 'Shiv Ling'. This is termed 'Jala Abhishek' (Offerings of water) is celebrated with great reverence. The Nalcha Mata temple, 3kms from Pashupatinath temple, is another site of religious importance. Khilchipura is also famous for opium production. Culinary Mandsaur is famous for its distinctive 'Dal Baffla' (a dish comprising of lentils and wheat) and 'Kachori'.