Bally Manufacturing Company was created as a subsidiary of Chicago's Lion Manufacturing on January 10, 1932 to manufacture pinball games. Raymond J. Moloney, whose popular Ballyhoo pinball game was its namesake, would lead the company until his death on February 26, 1958. In that time they would diversify their products, expanding into slot machines and even vending machines.

Struggling financially after Moloney's death, 1963, Bally would be bought by independent investors headed by the head of Bally sales, Bill O'Donnell. O'Donnell lead an immensely successful rejuvenation of Bally, and in 1968 Bally Manufacturing Corporation would be incorporated as a publicly traded company, producing pinballs as well as dominating the gambling market.

In 1981 Bally merged its pinball division with video game maker Midway to form Bally Midway Manufacturing in what would be the beginning of a "buying spree,"  acquiring theme park operator Six Flags, the MGM Grand Hotel, and Health & Fitness Corporation, among others. Then, heavy width debt, Bally sold its Bally Midway division to Williams Electronic Games in 1988. Williams would obtain the right to use the Bally brand name on its own titles, and would continue using the Midway name as well.