Old Grand-Dad was a distiller named Basil Hayden who made his name by distilling a bourbon whiskey made with a higher percentage of rye. Basil Hayden passed along the art of distilling to his son and then, in turn, to his grandson. It was the third generation distiller, Colonel R.B. Hayden, who honored his grandfather by naming his justly famed whiskey "Old Grand-Dad."

During Prohibition, Old Grand-Dad was produced by a pharmaceutical company, the American Medicinal Spirits Co., and was one of the few distilled spirits permitted to be prescribed as medicine.