The company was started in 1881 by Swedish-born Julius Nelson, his brother Carl. Vega were best known for their banjos but also made acoustic guitars and other stringed instruments. Quality declined in the 1940s and 1950s and in the 1970s the CF Martin company bought the Vega company, with a view to producing Vega banjos. Some Martin designed Vega acoustic guitars were made in Sweden by the Levin company in the early 1970s. Later in the 1970s some Vega acoustics were made in the Netherlands.

More recently a Korean company acquired the Vega brand name for Korean built instruments.