The Grand Canal (Da Yunhe) waterway connects the Huang He (Yellow River) system of North China with the Chang Jiang (Long River, a.k.a Yangtze River) system of Central China. Work on it initially began in the fourth century BCE but the major development occurred in during the four-year period of 607 to 610 CE during the Sui dynasty. It was needed in particular to transport grain from the southern Chang Jiang and Huai Jiang valleys to the northern capital areas. Its maintenance and development was continued after the rise of the Tang dynasty (618 CE) and the Sung dynasty (960 CE).

During the period of Mongol control (1279-1368) of China (the Yüan dynasty) there was a need to build new sections of the waterway to adjust to changes in the course of the Huanghe. The Huanghe which had a southerly course during the period when work first began on the waterway system in the 300's BCE later changed to a northerly course. By the time of the construction of the waterway system in 607-610 CE it still had a northerly course. Just before the time of the Mongols the Huanghe shifted to a southern course (1195 CE). Grain supply of the northern capital (Beijing) created by the Mongols was of crucial importance until the Chinese learned to ship grain by a coastal sea route.

Under the Ming dynasty (1368-1644) the capital was moved from the northern capital of Beijing to the southern capital of Nanjing for a period of time. The transport of grain north was not so crucial when Nanjing was the capital of the empire, but in 1403 the Ming rulers moved the capital back to Beijing. The Ming government then dredged and reconstructed the Grand Canal to essentially its final form.

The waterway, which consists in part of canalized rivers as well as dredged canals has six segments:

• The ancient Shanyang Canal running from the Changjiang at Zhenjiang to Qinjiang
• The section of the old southern course of the Huanghe from Qinjiang to a point near Xuzhou
• The section in Shandong from nea Xuzhou to Linqing. This is the most hydrologically difficult part of the waterway, requiring dams and sluices.
• A section of a canalized river (Weihe) from Linqing to Tianjin and another canalized river (Paihe) from Tianjin to Tungxien
• The section from Tungxien to Tongxian on the outskirts of Beijing
• At the southern end of the waterway there is an extension connecting the Changjiang to Wuxi and Suzhou and on to Hangzhou.

During the nineteenth century due to flooding and rebellions the Grand Canal waterway fell into disuse. It was not until 1934 that the Guomindang government of Chiang Kai-shek carried out a program of repair that brought it back into use. That program not only repaired the waterway but impoved it by means of dredging and locks to allow its use by medium-sized steamships. The Communist government after 1949 continued to maintain the waterway and rebuilt it between 1958 and 1964. It remains an important transportation link between central and northern China.

For more on the history of China see China.