Indianola is a city in Red Willow County, Nebraska, United States. The population was 642 at the 2000 census. On 27 March 2004, a fire that started in the town's only grocery store destroyed the store and the city offices.
In its early days, Indianola was the county seat of Red Willow County. After the railroad opted to locate its mid-point terminal on the Omaha to Denver route in McCook rather than in Indianola (McCook offered free land for the rail yard whereas a private citizen in Indianola requested a large sum for his land thinking it was a done deal), population shifted to McCook and after several attempts, some violent, the county offices were moved to McCook.
Located in the City Park of Indianola is the grave of a Pawnee woman who died of wounds received at the battle between the Sioux and Pawnee tribes at Massacre Canyon just east of Trenton, Nebraska. Originally she was buried northwest of town on a bluff overlooking Coon Creek. In the 1970s, it became obvious that erosion would eventually destroy her gravesite, and in 1975 she was reburied in the park, with representatives of the Pawnee tribe participating in the ceremony.