The Beta Sigma Chapter of Sigma Chi was established at UT on September 17, 1917, at the downtown L&N Railroad Station. Sigma Chi was petitioned for a charter by the local Sigma Kappa Delta fraternity, which had been started four years earlier by four men who had brothers or good friends who were members of Sigma Chi through other universities. Before they entered the university, they determined to form a local fraternity that would have as its goal the attainment of a charter from Sigma Chi.
Sigma Chi was founded at Miami University in Oxford, Ohio, in 1855. The colors of the fraternity are blue and old gold, and the flower is the white rose. Traditions of the institution include the long-running Sigma Chi Derby and Derby Week (beginning in 1968), as well as the Sweetheart Ball and the Blue and Gold Ball. Among notable alumni of the national organization are David Letterman, Johnny Majors, Brad Pitt, John Wayne, Mike Ditka, Lamar Alexander, and Jim Haslam. In 1964 the fraternity sold its house at 1119 Circle Park to the Knoxville Housing Authority as part of the Yale Avenue Urban Renewal Project for $76,000.
In the early 2000s, the university required all fraternities to upgrade their fire alarm systems and to meet current safety codes in order to re-sign their house lease with UT. With the 50-year date of re-signing approaching, Sigma Chi closed its house for the 2008–9 academic year in order to perform an extensive $1.7 million renovation. The renovations increased the number of beds from 32 to 40, provided a $250,000 upgrade to the kitchen, updates to all bathrooms, and changed the flat-roof design to a pitched design. Other reconfigurations of spaces were also made.
Sigma Chi was placed on probation in 2010 following two separate drinking and fighting incidents at the fraternity house and again in 2011 after an officer responded to a fire alarm and found burned bed sheets and candles used in an initiation ceremony. It was placed on probation in 2013 due to hazing activities involving food and garbage on August 27. The two-year probation banned the chapter from all social events and required each member to perform community service. The chapter was also required to present a fraternity-wide hazing reeducation and prevention program and to pay to install security cameras in the public areas and exterior of its house.