Dire Dawa lies in the eastern part of the nation, on the Dechatu River, at the foot of a ring of cliffs.

The region was already inhabited in Mesolithic times, as revealed by rock paintings and Middle Stone Age artifacts in the cave of Porc-Épic and Laga-Oda only a few kilometers from Dire Dawa.

[15] During the 19th century, the region was considered the domain of the Emirate of Harar until Menelik's conquest of the kingdom in 1887 and consequently became incorporated into modern Ethiopia from thereon.

It owes its foundation to a technical problem: when it became impossible to lay the Addis Ababa-Djibouti Railway via Harar because of the steep access to the town, Emperor Menelik II accepted (in a later dated 5 November 1896) that the first part of the line might finish at a village at the foot of the mountains, which should be named Addis Harar ("New Harrar").

For financial and diplomatic reasons the railway was not continued until 1909 and the final inauguration of the whole line from Djibouti to Addis Ababa-again delayed by the revolution of 1916-only took place on 7 June 1917.

During all this time, Dire Dawa was practically the town profited much and became a "boom city", attracting most of the trade which formerly passed through Harar.

[20] Dire Dawa developed into two settlements separated by the Dechatu River, which was dry for most of the year and became a torrent only when it rained.

At first, this part of the town mostly housed the employees of the railway company, but it later attracted, besides the French, also Greeks, Armenians, other Europeans and Arabs, who opened shops and hotels and founded some industry as well.

Though Lij Iyasu's governor there, the Syrian Hasib al-Idlibi, assured their security, 400 Europeans left the town and the rail traffic had to be suspended.

[21][22] The imperial railway company (Cie) played a key role in the early development of the city, particularly Gezira (aka Kezira), under the authority of the Ethiopian government.

The original failed company was reorganized as the joint-government Franco-Ethiopian Railway in 1908 and, after a period of financial negotiation and recapitalization, construction began anew, linking the city with the Ethiopian capital Addis Ababa in 1917.

Rey described the city as the most "advanced" urban center in the area, with good roads, electric lights, and piped water.

During the Italian invasion, Mussolini ordered that Addis Ababa and Dire Dawa be spared air attacks (which included the use of chemical weapons such as mustard gas) and other destruction as a response to the demands of the United States and certain European countries for the safety of their citizens.

General Graziani's units, advancing from Harar, reached the city's barbed-wire fence on 6 May 1936, the day after the occupation of Addis Ababa and Emperor Haile Selassie's flight along the railroad to Djibouti and Palestine.

In June 1940 the British started to bomb the town and on 29 March 1941 Dire Dawa was occupied by the Allied forces from Harar.

That same year, the Railroad Workers Syndicate of Dire Dawa, a labor union, was formed for welfare purposes.

[27] In 1955, a public address system was installed in the central square to receive and rebroadcast state radio transmissions.

Starting March 1974, there was some worker unrest; six people were wounded when police opened fire on demonstrating railwaymen and students on 17 April.

Many Europeans, Yemeni Arabs, and Indians left Dire Dawa; the Greek and Armenian churches were eventually closed due to dwindling membership.

The battle was fierce, but it was ultimately the Ethiopian air force that shattered the Somali resolve by destroying sixteen of their tanks.

By day's end, the attackers had exhausted their strength and retreated, leaving behind a trail of abandoned equipment, including tanks, armored cars, rocket launchers, artillery pieces, as well as hundreds of rifles and machine guns, all proudly displayed by the Ethiopian forces.

A historic and popular part of the city is to be demolished and replaced by a financial center, malls, mixed-use buildings, hotels, recreational facilities, and hospitals.

New roads, parks, and an industrial zone will also be built, and major railway project is expected to greatly increase business activity in the city.

[3] Based on the 2007 Census conducted by the Central Statistical Agency of Ethiopia (CSA), Dire Dawa had a population of 341,834, of whom 171,461 were men and 170,461 women.

Lewis (1998) states: "Including the land round Harar and Dire Dawa inhabited by the Somalis of the 'Iise and Gadabuursi clans.

[48] Dire Dawa is served by a station on the Addis Ababa–Djibouti Railway, which is located 10 km northwest of the city centre close to the town of Melka Jebdu.