The temple grounds of Wat Simuang, located at the three-way intersection where Thanon Setthathirat and Thanon Samsenthai meet Thanon Thadeua, are believed to have been a sacred site since the earliest times. The remains of a twin laterite chedi (stupa) stand at the rear of the present-day sim, and a pillar or lintel stone, perhaps part of a Khmer sanctuary which became the lak muang or city pillar of Vientiane in 1560 when King Sai Setthathirat I moved his capital here from Luang Prabang, forms the centrepiece of the altar in the sim.

According to local legend, a young monk and a pregnant woman were sacrificed by being thrown into the pit before the lak muang was set in place, in order to embody the nya mai simuang, protective spirit of the town. Since that time the site has been one of the most feared and venerated in the city.

The temple was destroyed during the Siamese invasion of 1828 but rebuilt in 1915 and extensively renovated in 1970. Each year Wat Simuang plays an important role in the Boun Phra That Luang.