This important artificial waterway that continues to be used today was first conceived around 1772, when it was presented to the Virginia General Assembly. In 1807, Virginia and North Carolina granted charters to the aspiring company, but apparently because the Dismal Swamp Canal was already under construction, no stock was subscribed for the venture.

Following the War of 1812, Major Kearney examined the planned route while he was assigned as inspector of the Dismal Swamp Canal. With the interest of the state government in mind, he concluded that the expense of improving the existing canal would be trifling compared to the cost of building a new canal. Interest in the canal persisted, however, and over the next few decades several surveys were made by state and local agencies.

The North Carolina Board of Internal Improvements was created in 1819 by Archibald D. Murphey, a leading canal advocate, and the board hired the English engineer Hamilton Fulton to perform its surveys. Fulton's reputation was so distinguished that when the state of Georgia created a Board of Public Works in 1825, Governor Robert Troup selected him for the chief engineer.

It was first organized in 1850 as the Great Bridge Lumber and Canal Company with Marshall Parks of Norfolk, Virginia as president and chief proponent. His father had been the manager of the Dismal Swamp Canal and knew of its problems - and, the younger Parks had been employed on that canal construction.

Reorganized in 1856 as the Albemarle and Chesapeake Canal Company (the merger of the Virginia company with a North Carolina company), construction began in 1856. Construction consisted of tidewater cuts and river channel improvements of the Elizabeth River (in Virginia) to the Great Bridge over the North River (in North Carolina), at which was located a reversible guard lock with double gates at each end of a 220-foot long chamber.

The original canal was forty (40) feet wide and roughly eight (8) feet deep with the one lock to handle an elevation rise of three (3) feet between the Elizabeth River and the North Landing River. At completion, the canal cost a little more than one million dollars. This waterway was sometimes referred to as the Juniper Canal because of the petrified juniper roots that had to be cut during its excavation.

The Virginia cut was 8.45 miles long, and the North Carolina cut was 5.6 miles long for a total of 14.1 miles in length. This canal was proposed by private interests to offer direct competition with the Dismal Swamp Canal further west. Newly available steam dredge technology is what made the canal a reality. A sea level canal, it depended on self-propelled craft and steam tugs, and it opened up the Currituck Sound region providing a deeper draft and better services than the Dismal Swamp Canal, except for a brief period after the Dismal Swamp Canal was rebuilt in 1899.

In January 1859, the first vessel passed through the canal, a 75-ton schooner-rigged barge towed by a company side-wheel steamer. A steady stream of traffic followed. During the U.S. Civil War, when the Union Army commandeered the canal, nearly 9,000 vessels made the transit. After the War, traffic continued to increase as the waterway took over practically all of the trade passing between the Albemarle Sound and Norfolk, Virginia.

The guard lock, reconditioned in 1973 and floored, is unique since it handles alternate heads of water from west and east in the tidal Elizabeth River and fresh water from the North Landing River.

Considered part of the total canal project are - improved section of Southern Branch River and Elizabeth River, Great Bridge Lock, Virginia Cut, North Landing River dredging and straightening, Currituck Sound dredging, the North Carolina (or Coinjock) Cut, and North River dredging and straightening to the Albemarle Sound. The project included over forty-one (41) miles of river improvements the make the total waterway length of fifty-five (55) miles.

The United States government acquired the Albemarle & Chesapeake Canal in 1912 and improved it, first eliminating the guard lock, then in 1932 replacing it with the present six hundred (600) foot steel and concrete guard lock. The channel was dredged and maintained for a twelve (12) foot draft.

Covering a distance of almost two hundred (200) miles from Norfolk, VA to Beaufort, NC, the waterway varies in bottom width from ninety (90) feet in land cuts to three hundred (300) feet in open waters. Between 1970 and 1979, commerce on the Albemarle & Chesapeake Canal portion of the Intracoastal Waterway averaged roughly 1.4 million tons annually.