The city of Shelbyville was founded by Shelbyville Manhattan in 1796, who held the belief that people should be allowed to marry their cousins, due to the fact "they're so attractive"; a practice disallowed by fellow explorer and founder of Springfield, Jebediah Springfield. As a result of this disagreement, the two founders and their party split into separate groups, and went their own ways; since that time, the populaces of Springfield and Shelbyville have held a strong rivalry. This feud was demonstrated in the episode “Lemon of Troy” when a group of Shelbyville kids stole the Springfield lemon tree and the Springfield children enter Shelbyville in search of the tree, using guerrilla tactics. This episode is the only episode which shows Shelbyville in detail; including yellow fire hydrants, which causes bully, Nelson Muntz, to chime, "This place is starting to freak me out." Shelbyville is also the home to lemon-shaped rocks, an impound yard and bizzaro Milhouse. The true calling card of a kid from Shelbyville is a candy wrapper. As noted by the real Milhouse, "They're always eating candy in Shelbyville; they love the sweet taste.", unlike the people of Springfield, who enjoy eating lemons (being the sweetest fruit available at the time of the founding of Springfield, according to Grandpa Simpson).
The rivalry is apparently well-known even among outsiders; in Marge vs. the Monorail, a slick-talking salesman convinces the residents of Springfield to spend a large sum of money on a monorail system they don't need by musing that the idea might be better suited for Shelbyville. (Mayor Quimby quickly tells him that the Springfieldians are twice as smart as the people of Shelbyville, so if he'll just tell them his idea, they'll vote for it.)