The Grand Bazaar is located inside the walled city of Istanbul, in the district of Fatih and in the neighbourhood (mahalle) bearing the same name (Kapalıçarşı).

The construction of the future Grand Bazaar's core started during the winter of 1455/56, shortly after the Ottoman conquest of Constantinople and was part of a broader initiative to stimulate economic prosperity in Istanbul.

[1] In a market near the Bedesten, named in Turkish Esir Pazarı, the slave trade was active, a use also carried over from Byzantine times.

The enormous extent of the Ottoman Empire in three continents, and the total control of road communications between Asia and Europe, rendered the Bazaar and the surrounding hans or caravanserais the hub of the Mediterranean trade.

According to several European travelers, at that time, and until the first half of the 19th century, the market was unrivaled in Europe with regards to the abundance, variety and quality of the goods on sale.

[10] In the Bazaar there were 67 roads (each bearing the name of the sellers of a particular good), several squares used for the daily prayers, 5 mosques, 7 fountains, 18 gates which were opened each day in the morning and closed in the evening.

The number of shops amounted to 3,000, plus 300 located in the surrounding hans, large caravanserais with two or three stories round a porticoed inner courtyard, where goods could be stored and merchants could be lodged.

[12] Other fires ravaged the complex in 1588, 1618 (when the Bit Pazarı was destroyed), 1645, 1652, 1658, 1660 (on that occasion the whole city was devastated), 1687, 1688 (great damage occurred to the Uzun Çarşı) 1695, and 1701.

[17] The fire of 1701 was particularly fierce, forcing Grand Vizier Nevşehirli Damad Ibrahim Pasha to rebuild several parts of the complex in 1730–1731.

The quake of 1766 caused more damages, which were repaired by the Court Chief Architect (Hassa Baş Mimarı) Ahmet a year later.

[19] Moreover, the birth of a West-oriented bourgeoisie and the commercial success of Western products pushed the merchants belonging to the minorities (Greek, Armenian, Jewish) into moving out of the Bazaar, perceived as antiquated, and into opening new shops in quarters frequented by Europeans, such as Pera and Galata.

[20] According to an 1890 survey, in the Bazaar there were 4,399 active shops, 2 bedesten, 2195 rooms, 1 hamam, one mosque, 10 medrese, 19 fountains (among them two şadırvan and one sebil), one mausoleum and 24 han.

[17] The Minister of Public Works, Mahmud Celaleddin Pasha, supervised the repair of the damaged Bazaar until 1898, and on this occasion the complex was reduced in area.

In 1914 the Sandal Bedesten, whose handlers of textile goods had been ruined by the European competition, was acquired by the city of Istanbul and, starting one year later, was used as an auction house, mainly for carpets.

[12] The building can be accessed through four gates: The Sandal Bedesten has also a rectangular plan (40.20 m × 42.20 m), with 12 stone piers bearing 20 bays surmounted by brick domes with blind drum.

Aside from the bedestens, originally the Grand Bazaar structures were built with wood, and only after the 1700 fire, they were rebuilt in stone and brickwork, and covered.

The damages caused by the many fires and quakes along the centuries, together with the repairs done without a general plan, gave to the market – especially in its western part – a picturesque appearance, with its maze of roads and lanes crossing each other at various angles.

Until the restoration following the quake of 1894, the Grand Bazaar had no shops as found in the western world: along both sides of the roads merchants sat on wooden divans in front of their shelves.

[32] The only official night opening in the history of the Bazaar occurred in 1867 during the feast organized for the return of Sultan Abdülaziz from Egypt, when the sovereign crossed the illuminated market riding a horse among the rejoicing populace.

[32][33] Despite the immense wealth present in the Bazaar over the centuries—as an English traveller recorded as late as c. 1870, a tour of the inner Bedesten could easily ruin a few Rothschild families[34]—theft occurred extremely rarely.

[35] The theft shocked the whole of Istanbul, the Bazaar remained closed for two weeks and people were tortured, until the money was found hidden under a floor matting.

These organizations became less and less important with time due to the increased weight of the Greek, Armenian and Jews merchants in the bazaar's trade.

[42] Each guild had a financial department which collected a moderate monthly fee (some silver coins; Turkish: Kuruş) from the members and administered it taking care of the needs of each associated person.

[31] Today the Grand Bazaar is a thriving complex, employing 26,000 people[44] visited by between 250,000 and 400,000 visitors daily, and one of the major landmarks of Istanbul.

The head of the Grand Bazaar Artisans Association claimed that the complex was in 2011 – the year of its 550th birthday – the most visited monument in the world.