It was founded in 1922 as displaced persons from Asia Minor arrived in the city after the 1919–1922 Greco-Turkish War and the subsequent population exchange between Greece and Turkey.
In 1926 construction began on the first refugee settlements in an area belonging to the families Roufou and Hereti that at the time consisted of reed wetland.
The refugees took up all kinds of work, men often running small businesses such as selling ice or firewood, or being employed at woodworks or raisin processing factories; women worked in textile and fabric factories.
The settlement has a largely poor population to date, however the refugees kept a rich heritage of customs and traditions.
The coffee houses of the settlement, notably Byzantion and Aigli, frequented by groups of men, were the centres of the community.