Khan in Arabic means an inn (hotel). Khan Al-Sultan is located inside the Old City, off Shari' Al-Silsileh. The royal khan was built in 1386 by order of the Mamluk sultan Barquq. The aim was to provide accommodation to the travellers and merchants who came to Jerusalem. Sultan Barquq sought to improve the city's condition and undertook civil building projects for the public welfare. He built the Sultan's Pool and repaired the aqueduct that brought water to the city from the Arrub spring.
The khan was built very close to the market centre of Jerusalem in order to enhance its commercial life. The covered passageway formerly contained a dedicatory inscription describing the construction of the khan by Barquq. There are porches on either side of the passageway and which lead to the small rooms that were used as lodgings or shops. The rooms are humble and their only source of light and air is a square opening above the doors. At the end of the passageway is a narrow staircase that leads up to the porches. Some believe that the passageway was already built in the Crusader period and was later incorporated in the khan of Barquq. The passageway opens onto a large courtyard that is surrounded by rooms on two floors. The rooms on the first floor served as storerooms and stalls for animals while those on the second floor were used by the merchants themselves.