The Mrtvi kanal appeared on the city map when it was decided that the final part of the Rječina, the main city river, should be deviated. The Rječina used to flood part of the city located close to its mouth during periods of high rainfall, so the city government decided to dig a new bed in 1885 and its flow was deviated further towards the east. Its former bed became the main city port. Here sailing boats entered transferring oil, wine, vegetables and fruit, so that the Mrtvi kanal banks operated as a market place as well.
One of the historically most important buildings located by the Mrtvi kanal is the house of Simeon Adamić built in 1787. He is also remembered thanks to the rumour that his wealth came from buried treasure that he had found and kept. Adamić ordered the creation of 14 bust sculptures of false witnesses who confirmed this fact and placed them close to the Mrtvi kanal bank for their shame. In 1906, the first permanent cinema in Croatia was opened in Adamić’s palace. From 1881 until 1896 the building housed the Croatian Gymnasium operated in the building.