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In the second half of the 19th century the neighborhoods of Pera (modern day Beyoğlu) and Galata (modern day Karaköy) had become the financial and commercial heart of Constantinople (modern day Istanbul) and the Ottoman Empire. Many Ottoman and foreign companies, mostly banks and insurance companies, set up their headquarters in these two neighborhoods. Separated by a large hill, Foreign embassies, hotels and commercial markets in Pera were located on the top while the stock exchange, banks and ports in Galata were at the bottom. Travelling between these two districts were tough as grades were as steep as 24%. The main street between these two areas, Yüksek Kaldırım Avenue, saw an average of 40,000 people commuting up and down the hill daily.
In 1867 a French engineer, Eugène-Henri Gavand, came to Constantinople for touristic purposes. During his visit he was taken back at the amount of people travelling on Yüksek Kaldırım Avenue. Gavand thought of a method to connect these two areas and came up with building a funicular railway that would ascend and descend the hill. Gavand went back to France shortly after to prepare his project. He returned to Constantinople in February 1868 to present his project to the Sublime Port. The railway would run from beginning of Yüksek Kaldırım Avenue in Pera to Yenicami street and close to the Galata Bridge in Galata. On 10 June 1869 Sultan Abdülaziz granted Gavand with a concession to build the railway. Gavand worked with shareholders in France to start up a company to build the railway, but due to the Prussian invasion of France the formation of a French-based company became impossible.
During the war, Gavand went to the United Kingdom to set the company up there. He formed the Metropolitan Railway of Constantinople to construct the line with the starting date being on 1 September 1871. Construction began on July 30, 1871 but was delayed significantly by conflicts between landowners and the company. The tunnel was not completed until December 1874 ]and was finally opened for service on January 17, 1875.
The Metropolitan Railway company gained a fresh 75-year concession in 1904 but the Tünel was nationalised in 1923 when the Turkish Republic was proclaimed. In 1939 it was absorbed into the new IETT (İstanbul Elektrik Tramvay ve Tünel) transportation organization. It was modernised and electrified in 1971. Today, the short line is no longer as vital for Istanbul’s inner city traffic as it used to be back in the 19th century, but it is still a part of the municipal transport network and integrated tickets are valid
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