It's a slightly odd sensation, discovering Sub Pop is about to turn 20, akin to discovering that eternal teenager with the lank hair and torn jeans is finally, well, a grown man. But that's what's happening. On Saturday, the label is gathering past and present bands from its two-decade run for a mini-festival in Marymoor Park just outside Seattle, with old-timers like Mudhoney and Green River joining newcomers like Fleet Foxes, No Age, and comedy duo Flight of the Conchords, whose debut album saw the light of day on Sub Pop in the US.

In the UK, Sub Pop will perhaps always chiefly be associated with grunge, the Seattle sound that swept the globe in the early 90s, and for which Sub Pop acted as handmaiden, bringing the world Mudhoney, Tad, Soundgarden, and a little band called Nirvana to international attention. Sub Pop's groups were hairy, sweaty, unreconstructed, depressive, fucked-up; but also sardonic, dryly witty and intelligent. The video to Tad's Woodgoblins sums up the label's early aesthetic neatly, which is to say extremely messily: mountain-sized frontman Tad Doyle playing the lunatic redneck, pursuing his bandmates through the woods with a chainsaw. Of course, it was all a pose. In the Tad documentary film Busted Circuits and Ringing Ears, photographer Charles Peterson claims he had to help Tad start the chainsaw. "You wanna create that whole sense that we're an invading horde and we live on mountains and eat raw flesh," explains Sub Pop co-founder Jonathan Poneman. "And Tad played that role to a tee."

Grunge went big, thanks in part to glowing coverage in the UK music press, and many bands jumped to major labels - notably Nirvana, whose 1991 album Nevermind went on to top the Billboard charts. Sub Pop did not cash in on grunge; rather, it seemed quite ashamed by the way the look - battered Converse, flannel shirts, week-old stubble - quickly became a uniform and buzzword for style magazines the world over. Sub Pop employee Megan Jasper suckered the New York Times, sending them a lexicon of "grunge speak", which the newspaper printed verbatim - a "lamestain" is slang for a loser, while if you're hanging out you might be "swingin' on the flippety flop". Meanwhile, 1994 compilation album The Grunge Years satirised the attentions of the corporate music industry with a sleeve picturing two suited businessmen poring over documents in a limousine and a note reading "limited edition of 500,000".

As grunge waned, Sub Pop signed a deal with Warner Music, but even with an influx of cash - or perhaps because of it - the label struggled to redefine itself. Co-founder Bruce Pavitt jumped ship in 1996 to spend more time with his family, and a string of bands like Murder City Devils and the Black Halos failed to score either critical plaudits or actual sales.

More recently, however, the label has enjoyed something of a renaissance, finding success with a new crop of bands who, while not quite capturing the attention of the UK music press in the manner of their 90s stable, have come to define the tastes of a new generation of indie music fans who base their taste decisions on blogs and US indie webzine Pitchfork. Excepting Nirvana's Bleach, the label's biggest seller, Sub Pop's most successful acts are Seattle electronic duo the Postal Service and the Shins - a band immortalised in pop culture via their unwitting appearance in the film Garden State. Natalie Portman pops a pair of headphones bleeding the band's New Slang with the words "You gotta hear this song, it'll change your life". It's not quite Mudhoney's Touch Me, I'm Sick, but even an indie label's gotta grow up eventually.