This song finds Tim McGraw singing of a rebellious American Indian character. His fourth single overall, this was McGraw's first Top 40 country hit. It peaked at #8 on the country chart and #15 on the Billboard Hot 100.

The song was co-written by Tommy Barnes, who also penned a #1 country hit the same year with Little Texas' "My Love." American rockabilly singer-songwriter Jumpin' Gene Simmons was the other co-writer. He is best known for his 1964 novelty single "Haunted House".

The tune's success surprised McGraw. "'Indian Outlaw' was sort of this novelty, weird-sounding song," McGraw recalled at a media event in 2016. "I moved to town in May, early May, of 1989; the same day Keith Whitley died was the day I moved to town. That night … I met [songwriter] Tommy Barnes... We sat up in a hotel room, and he played me 'Indian Outlaw' that night, the first night I moved to town, and I told him I was going to record that song."

"It took me a while to get to it," McGraw continued. "I played that song in clubs forever, and it was just so different. I didn't know how people were going to take it. I didn't know it was going to work."

The song ends with McGraw shouting part of the main "Cherokee people" chorus from "Indian Reservation." The John D. Loudermilk-penned tune was a #1 pop hit for Paul Revere & the Raiders in 1970.