Kelly reopened the school as the Indiana Normal Institute. To pay for updated materials and refurbishing the once-abandoned Administration Building, the school operated under a mortgage from the Muncie Trust Company. Although the school had its largest student body with a peak enrollment of 806, officials could not maintain mortgage payments, and the school was forced to close once again in June 1917 when the Muncie Trust Company initiated foreclosure proceedings.

The Ball brothers and Ball State Teachers College era (1917-1960)