Kinetic theory and numerical simulations are used to explore the dynamics of a dilute gas-solid suspension subject to simple shear flow. The particles experience a Stokes drag force and undergo solid-body interparticle collisions. Two qualitatively different steady-state behaviours are possible: an ignited state, in which the variance of the particle velocity is very large; and a quenched state, in which most of the particles follow the local fluid velocity. Theoretical results for the ignited state are obtained by perturbing from a Maxwell distribution, while predictions for the quenched state result from consideration of the collision of particles that initially move with the fluid. A composite theory, which includes effects of collisions driven by both the mean shear and the velocity fluctuations, predicts the existence of multiple steady states. Dynamic simulations and calculations using the direct-simulation Monte Carlo method confirm the result that, for certain volume fractions and shear rates, either the quenched or ignited state can be achieved depending on the initial velocity variance. Simulations are also performed for particles experiencing a nonlinear drag force. Both the theory of rapid granular flow, which neglects drag, and our theory for the ignited state with linear drag predict that the particle velocity variance can grow without bound as ϕ→0, where ϕ is the volume fraction. The nonlinear drag force eliminates the divergence and leads to a particle velocity variance that will always decrease with decreasing volume fraction in the limit ϕ→0.