The band began as a solo recording project of singer/songwriter Andy Gonzales, who first recorded as Marshmallow Coast in 1996 with a self-released cassette,[1] which featured contributions from Joel Richardson of The Minders. After a split single release, Gonzales met up with old friend and Neutral Milk Hotel member Julian Koster to record Timesquare. While it was recorded in 1997, it did not get released until 2000 due to various label disputes.

Gonzales, after releasing some more singles, dropped the Marshmallow Coast project temporarily to tour with Music Tapes, Koster's side project, and relocate to Athens, GA in 1997. In Athens, Gonzales met with Kevin Barnes and Derek Almstead, singer/songwriter and bassist/ engineer, respectively, of the relatively new Of Montreal. With Barnes, Gonzales recorded Marshmallow Coast's second album, 1999's Seniors & Juniors, and became a member of Of Montreal himself. The other members of the band became his backing band for a couple singles including the split with Of Montreal and with My First Keyboard.

2000 brought the Derek Almstead produced Marshmallow Coasting, and a tour with Of Montreal. Gonzales then began a website-based project where he recorded songs for paying customers and gave them sole ownership. Derek and Andy's second collaboration Ride the Lightning was released in 2001 with another Of Montreal tour. Antistar released in 2003 without Derek or any other Of Montrealers and with the addition of Sara Kirkpatrick on flute, was produced by Jason NeSmith of Casper & the Cookies.

In late 2005, Gonzales announced that the project would show some changes, songwriting duties now being shared between Gonzales and Almstead. With the additions of Emily Growden on keys/vocal and Carlton Owens on drums, a full band was formed and the name changed to M Coast. A new album entitled Say It in Slang was released on Happy Happy Birthday To Me Records in October 2006.

In November 2007 it was announced that M Coast had parted ways. Andy has reverted to the name Marshmallow Coast again, while Derek, Emily, and Carlton are working on a new band called Faster Circuits.

May 2009 heralds the return to the Marshmallow Coast name with the release of Phreak Phantasy on HHBTM.

Seniors and Juniors Strikes Back was released on HHBTM in March 2011. The album, originally released in 1999, was re-recorded in the same style as their previous album, Phreak Phantasy, and contains a few new tracks.