Vestal is on the south border of the county and is west and southwest of Binghamton.
Vestal is home to Binghamton University which draws visitors to the town through its entertainment and sporting events. The university adds thousands of students to the town and employs more than 3,000 faculty and staff.
The first European settlers arrived in Vestal at around 1785.
The central area of Vestal, near Route 26 at Choconut Creek, was the site of an indigenous village of the Ochugnut tribe of the Tuscaroras. During the American Revolution, a squad of soldiers from the Sixth Massachusetts Regiment, under the command of Lt. William McKendry  were sent to exterminate the indigenous people. During the summer of 1779, the squad eliminated at least two villages, including one situated in what is now nearby downtown Binghamton (the Chenango, at the confluence of the Chenango and Susquehanna rivers), and the Ochugnut (Choconut) at the site of Choconut Creek near present-day Vestal Senior High School. Reasons for the attack include the Iroquois alliance with Great Britain during the American Revolution. However, some evidence indicates that at least some of the indigenous people were actually Tuscarora - descendants of the Cherokee who fled from North Carolina after wars in 1711 and the War of 1763. This community was actually sympathetic to the American cause, siding against the rest of the Iroquois confederation. See Sullivan Expedition or external links for more information on the role of Upstate New York in this conflict.  
Following the war, several European families settled in the area near the Town of Union.
The Town of Vestal was formed from the southern half of the Town of Union in 1823.
The history of the town is closely related to its neighbors, Binghamton, Endicott, and Johnson City. During the 20th century, Vestal served as a residential suburb to emerging industries in its area, such as Endicott Johnson Corporation, IBM, and Lockheed Martin.
In 1955, Harpur College began to plan its current location in Vestal, New York. This move was complete by 1961. The 387-acre (1.57 km2) site was purchased from Hazard Lewis Farms, a local dairy, anticipating future growth for the school. Originally founded as Triple Cities College of Syracuse University, in Endicott, New York, the college has become Binghamton University, the highest ranked public university in the Northeastern United States. The University adds 14,000 students to the local population each school year, and draws large numbers into the town for sporting, arts and other events.
During the 1990s, Vestal became the major retail center of the Southern Tier region of New York, with many large shopping centers such as the Town Square Mall, Parkway Plaza, Shoppes at Vestal, and Campus Plaza being built along the Vestal Parkway (NY Route 434), which became one of the busiest roads in the area. Vestal's historic central business district is located along three blocks of Front Street, still lined with small shops.