The city is named after the nearby Malad River, the name being French for "sickly". Malad City is located along Interstate 15 on the east side of the Malad Valley 13 miles from the Utah/Idaho border.
As of the census of 2000, there were 2,158 people, 797 households, and 561 families residing in the city. The population density was 1,294.6 people per square mile (498.9/km²). There were 908 housing units at an average density of 544.7/sq mi (209.9/km²). The racial makeup of the city was 98.01% White, 0.14% African American, 0.37% Native American, 0.23% Asian, 0.09% Pacific Islander, 0.56% from other races, and 0.60% from two or more races. Hispanic or Latino of any race were 1.85% of the population.
There were 797 households out of which 34.3% had children under the age of 18 living with them, 61.5% were married couples living together, 6.3% had a female householder with no husband present, and 29.5% were non-families. 27.9% of all households were made up of individuals and 16.8% had someone living alone who was 65 years of age or older. The average household size was 2.65 and the average family size was 3.24.
In the city the population was spread out with 29.9% under the age of 18, 7.1% from 18 to 24, 22.6% from 25 to 44, 20.0% from 45 to 64, and 20.4% who were 65 years of age or older. The median age was 38 years. For every 100 females there were 92.7 males. For every 100 females age 18 and over, there were 92.2 males.
The median income for a household in the city was $32,235, and the median income for a family was $38,068. Males had a median income of $29,125 versus $19,338 for females. The per capita income for the city was $13,926. About 6.2% of families and 10.0% of the population were below the poverty line, including 9.7% of those under age 18 and 13.8% of those age 65 or over.