The University of Nashville was originally chartered by the state of North Carolina (of which Tennessee was then a part) as Davidson Academy in 1785. The school was moved and rechartered as Cumberland College in 1806, and renamed again in 1827 as the University of Nashville. In its long history, the school served as a literary arts college, military college, medical school, and boys preparatory school, before the Civil War forced it into a financial crisis, and by the early 1870s the university could not keep its doors open.

In 1875, a donation from the Peabody Education Fund split the school into three entities: the medical school was absorbed into Vanderbilt University, the Montgomery Bell Academy prep school was made an independent school, and the State Normal School was formed. The Normal School, renamed Peabody Normal College in 1889, was intended to be the main school of its kind for the South, and a model for the structure and curriculum of teaching education. The Montgomery Bell Academy still exists today, and its school board retains the title “Board of Trustees of the University of Nashville”.

In 1909 the buildings and grounds of the Peabody Normal College were donated to the George Peabody College for Teachers, which, after several more changes and transitions, eventually merged with Vanderbilt University in 1979.