Although it was first surveyed in 1823, the Milan Canal was not completed until 1839. At first it was projected as a barge canal, but it later became a ships canal with Great Lakes vessels carrying several millions of dollars of trade a year through this waterway.

The initial step was the construction of a tow path from the mouth of the Huron River to Abbotsford (Fries Landing) that was completed in 1834.

From here to Milan the canal had to be dug all the way due to the meandering and shallowness of the river. In 1836, work began on the canal basin at Milan. Included with this were a dam and covered bridge, and a series of warehouses and mills. The canal was officially opened July 4, 1839, when the schooner Kewaunee anchored in the basin.

The canal was about forty feet wide, thirteen feet deep and three miles long. The fall was only seven feet for its entire length; therefore, only two locks were necessary. The Upper Lock was about a mile from the basin and the Lower Lock was located at the junction of the canal and river. The tow path was on the north to west (left-hand) side of the canal. Final cost of the canal ($23,392) far exceeded the estimate. But incredible prosperity followed.

The farmers coming north preferred bringing their wheat the shorter distance to Milan. The schooners preferred bringing their vessels right alongside the main wheat supply at Milan.

The Milan port drew the wagons of wheat growers from as far as 150 miles, averaging 100 wagons a day. Some days wagons were lined for three miles waiting their turn to unload.

In the peak year, 1847, on May 18, 20,000 bushels were received requiring 650 teams. Some days the port shipped as much as 25,000 bushels of wheat. Since wheat rolled into Milan faster than the vessels could float it out, Milan businessmen built more grain storage warehouses astride the river. Some of these warehouses were perched on top of the valley's ridge, so that chutes could be lowered to the vessels holds, gravity-feeding the grain into the ships.

Not only did the town prosper from the exporting of products, the Milan Canal Company took in $102,000 in the first five years just in canal tolls, paying $20,000 to its shareholders in dividends!