The Dundee Canal, along with the advent of railroads, stimulated rapid economic and population growth in Passaic and the surrounding area through the late 19th and early 20th century.
The Dundee Dam across the Passaic River was located at the north end of the canal, between Acquackanonk Township (present-day Clifton) and East Passaic (present-day Garfield), and it provided water for the canal.
[1] In 1857 the New Jersey Legislature authorized the company to raise the water level of the dam, and this action flooded adjacent areas and created Dundee Lake.
[3] The flooding of various properties led to calls by area manufacturers and other community members to make the canal into a navigable waterway.
The Dundee Canal's reliable water supply (both for power and manufacturing processes), and the availability of railroad service in the area (from branch lines that became part of the Erie Railroad) attracted manufacturing businesses to Passaic for the next several decades.
The canal bed was filled and used as a foundation for the highway from approximately its headwaters to Dayton Avenue.