Margilan is located in the south of the Fergana Valley, where trade caravans from China traveled westwards and vice versa during the days of the Silk Road.

More reliable records indicate that by the 9th century Margilan was an important stop on the Silk Road, along the route going across the Alay Mountains to Kashgar.

In the early 16th century Babur, the founder of the Mughal dynasty, mentioned that "the pomegranates and apricots are superb .... the game in Margilan is good; white deer may be found nearby.

Margilan merchants were key players in Central Asian commerce, and were said to be a law unto themselves during Soviet days, when the city was the heart of Uzbekistan's black market.

In 1994-2004, employees of the Institute of Archaeology of Uzbekistan worked in the city, which revealed the existence of irrigated agriculture in Margilan oasis since no later than IV-III centuries BC.

During World War II, in 1942, the 9th Infantry Division of the Polish Anders' Army was stationed and organized in Margilan, before it was evacuated from Uzbekistan to fight against Nazi Germany.

The neighboring Margilan Silk Factory employs 15,000 workers using modern machinery, and produces some 22 million square meters per year.

In the years of USSR in the city built a silk mill, art and sewing factory, repair-mechanical, tractor-repair, woodworking, iron foundry and dairy plants.

The factory is open to the public for guided tours, enabling tourists to learn about Margilan’s traditional silk weaving industry.

It takes place on Sundays and Thursdays in a location 5 kilometers west of the city centre, and offers textiles, fresh produce, and household goods.

It was founded in the 19th century by Said Akhmad Khodjaev, a wealthy philanthropist and advisor to the tsarist administration who later fled to Margilan during the Bolshevik Revolution.

The mosque has two impressive minarets, each 26 meters high, and original carved wooden pillars made from cedar by master craftsmen in Margilan.