The Indiana Harbor and Ship Canal are located on the southwestern shore of Lake Michigan in East Chicago, Indiana. The artificial waterway connects the Grand Calumet River to Lake Michigan. The harbor is made up of two canals (the two-kilometer Lake George Branch and the three-kilometer Grand Calumet River Branch) that form the Indiana Harbor Canal.
The Indiana Harbor runs along the two-kilometer stretch that connects to Lake Michigan. In 2002, the Indiana Harbor handled over 12 million metric tons of cargo, making it the 45th busiest harbor in the U.S. The Indiana Harbor handles more cargo than any other of the 25 Lake Michigan Federal commercial harbors, and it is the second ranking harbor in volume of the 55 Great Lakes Federal commercial harbors.
In 1901, the Inland Steel Company accepted 20 hectares of free land along Lake Michigan in exchange for a promise to build a harbor and railroad there. Inland Steel agreed to build a steel mill there, and the railroad that was constructed is still called the Indiana Harbor Belt Railroad.
During the first decades of the 20th Century, the shoreline grew to be an important industrial area serving the Great Lakes and the City of Chicago. In 1901 and 1902, work began on the canal. Many new industries sprang up along the waterway.
Mark Manufacturing established its East Chicago mill on the Indiana Harbor's west side in 1917, and Clayton Mark built a housing community for the company near the mill. The new development, Marktown, became a residential sanctuary in the middle of a heavily industrial zone that included a tin mill, a rolling mill, and a refinery.
The United States government took responsibility for Indiana Harbor and the canal in 1914. The first lighthouse appeared in the harbor in 1920, and the current tower was added in 1935.
Although Indiana Harbor has been hurt by foreign competition, it still produces steel, and mills continue to operate. Years of heavy industry have created a significant pollution problem in the Indiana Harbor and Canal, but plans are underway to dredge and clean up the waterway.