The legend has it that Khiva was discovered about 2500 years ago when Shem, the son of Noah discovered a well in the middle of the desert. Upon this fateful discovery, he exclaimed “Khi-wa!”, which means “sweet water”, and that is how Khiva got its name. As most civilization started off with the sweet discovery of precious water sources, we can safely assume that this is how it all started.
For the next 1000 years, the area was inhabited by settlements that utilized the nearby Amu-Darya River to grow crops. Many archeologists assume that Khiva was founded around the 5th or 6th century. As Islam spread to the area, the first major structures were built near Shem's well, and it became known as a small trading post on the Silk Road.
As Khiva grew to become one of the most important and busiest settlements around, it drew in many people from all over to the town. The first written sources are dated back from the 10th century. The Arab traveller, Al-Istachri, mentions Khiva in his enumeration of the most important settlements in Chorezm. Meanwhile, the Arab geographer, Ibn Battuta, visited Khiva in the 14th century. Going through the town and seeing the people of Khiva with its culture, he was impressed. He praised the emir who was untiringly taking care of law and order and reported that the city was so full of people that it was almost impossible to find one's way in the crowd.
During the 16th century, Khiva was finally made capital of an Islamic Khanate and this lead to the establishment of Khiva as a center of power in the region with various architectural projects developed around the town area. Some say that if Khiva did not have a rivalry with the neighbouring Bukhara, Khiva would not be as significant as it is now.
Ichan-Qala (literally "internal fortress") forms the internal city of Khiva. The borders of Khiva coincided with that in the 16th-17th centuries. The clay wall over 2,200 m in length and 7-8 m in height surrounded Ichan-Qala. The wall was fortified with semicircular towers. The embattled gallery went along the top of wall. Defensive walls of Ichan-Qala reliably protected Khiva down to invasion of Nadir-shah in the middle of 18thcentury. Iranian troops took Khiva and fortification system was partly destroyed. Khiva had expanded at the Qungrad dynasty. By the 20thcentury its area had been fifteen times as much as Ichan-Qala.
In the 19th century, taxes and money were introduced as a strong central power was created in Khiva. As the industry in Khiva grew, it became one of the most important markets of slaves in Central Asia. This went on for many years and eventually slavery was formally abolished during the October Revolution of 1917. Khiva has 94 mosques and 63 madrassahs, making it an important center for Islamic studies. In 1990, Khiva was recognized as a World Heritage Site by UNESCO for its significant role in the world of Islam.