June 14, 1777 the Stars and Stripes was officially adopted as the flag of the United States of America. In 1885 a schoolteacher from Wisconsin, BJ Cigrand, arranged for her students to observe the day as the Flag Birthday. The idea had legs as they say and over the next 30 years more and more schools and civic groups followed suit. However, it wasn’t until May 30, 1916 that President Woodrow Wilson officially established the day as Flag Day and it took until August 3, 1949 for the day to become an official Federal Holiday.
All of this information and much more can be found at http://www.usflag.org/history/flagday.html if you’re interested. I especially like this quote from Franklin K. Lane delivered at a Flag Day event in 1914, “I am what you make me; nothing more. I swing before your eyes as a bright gleam of color, a symbol of yourself.”