It was built in 1824 to permit ship traffic to pass the Lachine Rapids, thereby becoming a chokepoint of exports from all of Canada. It helped shape Montreal by attracting industry to its banks, particularly in the districts of Saint-Henri and Pointe Saint-Charles.
The canal became obsolete and was closed in 1959, being replaced by the South Shore Canal of the Saint Lawrence Seaway. In 2002, it was reopened as a pleasure boating area, despite environmental concerns due to heavy industrial contamination of its bottom, and the banks of the canal were redeveloped.
The banks of the canal offer bicycling and roller blading, as well as no fewer than two National Historic Sites: the Lachine Canal National Historic Site and The Fur Trade at Lachine National Historic Site.