Ismailia was founded in 1863, during the construction of the Suez Canal, by Khedive Ismail the Magnificent, after whom the city is named. Following the Battle of Kafr-el-Dawwar in 1882 the British established a base there.
The head office of the Suez Canal Authority is located in Ismailia at the shore of Lake Timsah. It has a large number of buildings dating from British and French involvement with the Canal. Most of these buildings are currently used by Canal employees and officials.
During World War I the British had an air base there and the Battle of Romani took place nearby. Ismailia War Cemetery was designed in 1919 by Sir Robert Lorimer marking the casualties of the battle.
In 1973 the Battle of Ismailia took place in the city.
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