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Wallace, Idaho is a city in and the county seat of Shoshone County, Idaho, in the Silver Valley mining district of the Idaho Panhandle. Founded in 1884, Wallace sits alongside the South Fork of the Coeur d'Alene River (and Interstate 90). The spot's central location in the mining district clearly offered promise as a town site. In fact, a news sheet published at the time extolled the town's favorable prospects because "it is on the Mullan Road, which is the main emigrant road on the Bitter Root divide." Wallace believed in his new venture and invested money to build access roads, put up lot fences and make other improvements. By the spring of 1885, Placer Center had a grocery store and several other small businesses. Within a year or so, there was also a general store, a sawmill, hotel and more. Wallace and Richard Lockey bought "Sioux half breed scrip" from a bank in Spokane, Washington to purchase an town site that would become the town of Wallace. Such scrip entitled the holder to "locate" (claim) unoccupied and unsurveyed public lands. Wallace's application for a land patent to secure title to the townsite was submitted to the United States General Land Office (GLO) in Coeur d'Alene on June 5, 1886. The settlement flourished, and by the fall of 1887 when its first school was opened, there were many saloons, one brewery, a large apartment building with a public hall, a hotel, and many stores and shops. On September 10, 1887, a narrow gauge rail line reached Wallace, leading to further growth. Within two years the railroad would offer regular scheduled service. On May 2, 1888, a group of citizens petitioned Shoshone County's county commissioners for the town's incorporation, now to be called "Wallace", after the Colonel. Wallace was appointed one of the five trustees of the new town. The letter reporting this action does not say what event led to the move. However, it asserted that the original scrip owner had "made oath that he had never parted with the original, and never gave anyone power to use his name in any other location." Newspaper reports suggested that this DOI decision might affect land claims in several places across the West. Some existing owners guarded their own lots in order to retain their right of ownership. Local historian Judge Richard Magnuson wrote, "By 2 a. m., everything was located and the rush subsided." Continuing their aggressive stance, the Wallace Townsite Company filed 13 legal suits, demanding $1,000 from citizens it claimed had illegally jumped their properties. Several years passed before all the disputes were fully resolved. Martial law was declared and lasted about four months, but none of the charges brought by authorities were upheld. A similar, although not nearly so deadly confrontation occurred in April 1899. It again began among the miners working northeast of Wallace. However, the union's target was the Bunker Hill & Sullivan Mining Company, which adamantly refused to recognize or deal with the miners' union. A huge force took over and blew up the company's mill at Wardner. During the Coeur d'Alene, Idaho labor confrontation of 1899 attackers murdered a non union miner and killed one of their own by "friendly fire." Alarmed by the size of attacking force – perhaps as many as a thousand men – Governor Frank Steunenberg imposed martial law. About a thousand men were rounded up and held in a crude prison, dubbed "the bullpen." But in the end, only one union man was convicted of a crime, and he was pardoned and released two years later.

In 1893, Wallace went from governance by a board of trustees to a city charter. The first official mayor was William S. Haskins, who would shortly thereafter be appointed as Idaho's first State Mining Inspector. Haskins was succeeded by Oscar Wallace, son of Colonel Wallace. Although set back by the devastation, the city soon resumed its growth, aided by strong demand for lead during World War I. After a post war lull, the industry resumed its growth in the 1920s.

A mining community with a "work hard, play hard" attitude, Wallace became well known for a permissive approach toward drinking, gambling and decriminalized prostitution. From 1884 to 1991, illegal yet regulated brothel based sex work openly flourished because locals believed that sex work prevented rape and bolstered the economy, so long as it was regulated and confined to the northeastern part of town. Throughout the rest of the country, progressive era politics drove red light districts underground, but madams in Wallace enjoyed unprecedented status as influential businesswomen, community leaders, and philanthropists.

By around 1930, residents downstream from the Coeur d'Alene mines were complaining about water and air pollution. Operators downplayed the issue, but did make a few process concessions. Then the ravages of the Great Depression virtually eliminated the issue for the duration. That was followed by the ramp up to World War II, which further kept the problems in the background. After the war, the metals industry in the region boomed, reaching a peak by around 1965. Process improvements continued but could not totally alleviate the effluent problems. And practically nothing was done about a half century of pollution buildup. Beginning in 1955, the U. S. Congress passed a series of air pollution laws, culminating in the Clean Air Act of 1970. That was followed two years later by the Federal Water Pollution Control Act. That and creation of the Environmental Protection Agency (EPA) put heavy pressure on mining operations, including those in the Coeur d'Alenes. When the Bunker Hill smelter in Kellogg shut down in 1981, the Silver Valley lost a vast number of jobs, three quarters of all the regional mining employment by some estimates.

According to the United States Census Bureau, the city has a total area of 0.84 square miles (2 km2), all of it land.

Wallace has a continental Mediterranean climate (Köppen Dsb) with warm summers and cold, snowy winters. Winters are relatively moderate for an inland location so far north, although heavy rainfall often occurs when mild Pacific air penetrates inland, as in January 1974 when of precipitation occurred including on the 16th. July 1973 to June 1974 was also the wettest "rain year", receiving , whilst the driest rain year from July 2000 to June 2001 saw only The most snowfall has been in January 1969; July 1968 to June 1969 also saw the maximum annual snowfall at
When cold air comes from Canada, temperatures can become severe, with the record low being on December 30, 1968. The coldest month since records began in 1941 has been January 1949 with an average of ; the hottest has been July 2007 with a daily mean of and a mean maximum of .

As of the census of 2010, there were 784 people, 364 households, and 190 families residing in the city. The population density was There were 535 housing units at an average density of The racial makeup of the city was 95.9% White, 0.1% African American, 1.0% Native American, 0.3% Asian, 0.4% from other races, and 2.3% from two or more races. Hispanic or Latino of any race were 2.3% of the population. There were 364 households, of which 20.1% had children under the age of 18 living with them, 39.3% were married couples living together, 8.8% had a female householder with no husband present, 4.1% had a male householder with no wife present, and 47.8% were non families. 42.3% of all households were made up of individuals, and 16.2% had someone living alone who was 65 years of age or older. The average household size was 1.99 and the average family size was 2.66. The median age in the city was 47.5 years. 16.1% of residents were under the age of 18; 8.7% were between the ages of 18 and 24; 21.4% were from 25 to 44; 34.1% were from 45 to 64; and 19.5% were 65 years of age or older. The gender makeup of the city was 52.9% male and 47.1% female.

As of the census of 2000, there were 960 people, 427 households, and 237 families residing in the city. The population density was There were 587 housing units at an average density of The racial makeup of the city was 94.90% White, 2.50% Native American, 0.10% Asian, 0.62% from other races, and 1.88% from two or more races. Hispanic or Latino of any race were 2.19% of the population. There were 427 households, out of which 25.5% had children under the age of 18 living with them, 41.0% were married couples living together, 8.4% had a female householder with no husband present, and 44.3% were non families. 39.3% of all households were made up of individuals, and 15.7% had someone living alone who was 65 years of age or older. The average household size was 2.14 and the average family size was 2.85. In the city, the population was spread out, with 22.9% under the age of 18, 6.8% from 18 to 24, 28.4% from 25 to 44, 25.8% from 45 to 64, and 16.0% who were 65 years of age or older. The median age was 41 years. For every 100 females, there were 99.2 males. For every 100 females age 18 and over, there were 104.4 males. The median income for a household in the city was $22,065, and the median income for a family was $33,472. Males had a median income of $25,288 versus $16,429 for females. The per capita income for the city was $14,699. About 12.8% of families and 20.1% of the population were below the poverty line, including 20.4% of those under age 18 and 10.5% of those age 65 or over.

The Wallace District Mining Museum documents and recounts the legacy of over a century of mining history in the region. Mine tours are offered in the Sierra Silver Mine in Wallace and the Crystal Gold Mine in nearby Kellogg. The Oasis Bordello Museum is dedicated to the history of sex work; housed in a former brothel, curious tourists or nostalgic former patrons can tour the upstairs, which has been preserved as it was when the women left. The former Lux Rooms has been repurposed into a boutique inn, and it also has many elements preserved from its brothel roots, including floor to ceiling gold veined mirrors. The Barnard Stockbridge Museum, located in the historic Holy Trinity Episcopal Church, displays period memorabilia and photographs maintained by the University of Idaho Barnard Stockbridge Photograph Collection. The collection consists of large format photographs taken by the studio of Thomas Barnard and Nellie Stockbridge between 1893 and 1965. The collection of photographs is considered the best photographic collection in the Northwest United States and one of the seven best collections in the county.

Regular annual events in Wallace include the Blues Fest, Statehood Day Parade, Huckleberry Festival 5k Walk/Run, Under the Freeway Flea Market, Gyro Days, Center Of The Universe Re Dedication, Fall for History, Extreme SkiJor, and Home for the Holidays Christmas Festival.

Wallace is accessible via Interstate 90 and State Highway 4. The nearest airport is Shoshone County Airport (S83), about 15 mile (24 km) west, near Smelterville. In its prime, two railroads served Wallace. The Oregon Washington Railway & Navigation Co. (Union Pacific) reached Wallace from the west, offering passenger service to Spokane and Portland until about 1958, and freight service to Spokane as late as 1992. The Northern Pacific Railway approached Wallace from the east with its branch over Lookout Pass to the NP mainline at St. Regis, Montana. The former NP depot was listed on the National Register of Historic Places in 1976. To avoid demolition during freeway construction, it was moved 300 feet (91 m) south a decade later in 1986. Now at Sixth and Pine streets, it currently functions as a local railroad museum. The former NP line was abandoned and removed between St. Regis and Mullan in 1980. Union Pacific continued operating the Wallace Mullan segment of the NP line until abandoning the entire Plummer Mullan route in 1992. After abandonment, this segment of former UP and NP lines was developed into a rail trail, the Trail of the Coeur d'Alenes, which runs from east of Mullan through Wallace, to the Washington Idaho state line west of Plummer. Several miles to the south, the Chicago, Milwaukee, St. Paul and Pacific Railroad, commonly called the Milwaukee Road, ran transcontinental passenger trains on its Pacific Extension between Chicago and Seattle from 1911 to 1961, with freight trains until 1980. After the Milwaukee Road discontinued and abandoned the route, much of it also became a rail trail, the "Route of the Hiawatha Trail". Currently, it runs from Taft, Montana (near the top of Lookout Pass), descending west to Avery. This trail is at least 15 mile (24 km) distant at its closest point, but as the nearest large community, Wallace advertises itself as the primary jumping off point for trail users.

Interstate 90 passes through Wallace on an elevated freeway viaduct, completed in 1991. Until then, I 90 traffic used a surface highway previously designated U. S. Route 10 and used the main city streets through downtown. Wallace had the last traffic light on a coast to coast Interstate highway, a fact that is displayed on signage in downtown Wallace proclaiming it to be "The Last Stoplight." In September 1991, the Idaho Department of Transportation moved I 90 to a freeway viaduct above the north side of town. Prior to this, the interstate turned into arterial streets on the western outskirts of town and followed the main road through town before becoming a highway again on Wallace's east side. The section of US 10 through Wallace is now designated Interstate 90 Business. The Federal Highway Administration (FHWA) originally planned to build I 90 as an at grade freeway. This plan would have demolished most of downtown Wallace. In the 1970s, city leaders listed every building in the downtown on the National Register of Historic Places. The FHWA had to redesign I 90 to bypass downtown because federal law protects historic places from negative effects of highway construction.

The 1997 film Dante's Peak was shot on location in Wallace, which was portrayed as the fictional town "Dante's Peak" in Washington state, with a large hill just southeast of the town digitally altered to look like a volcano. On September 25, 2004, Mayor Ron Garitone proclaimed Wallace to be the center of the Universe. Specifically, a sewer access cover was declared to be the precise location of the center of the Universe. A specially made manhole cover was made to mark the spot. It bears the words "Center of the Universe. Wallace, Idaho." This prompted British comedian and writer Danny Wallace to visit Wallace. He wrote about his visit in the book Danny Wallace and the Centre of the Universe, published in 2006. The event is celebrated on the third Saturday of September.