The history of the dahabiya goes back to the Pharaonic times: there are inscriptions of very similar boats in the tombs of ancient Egyptian Kings and Nobles.

Originally built to carry celebrities and royal families, the Dahabiya was a luxury boat for the Nile. Famous Egyptian leaders, such as King Farouk and President Sadat, had their own dahabiyas, and the English novelist, journalist, traveler, and Egyptologist Emilia Edwards even had a piano installed on hers. Aristocrats loved them, especially as the journey could take up to two or three months to complete, stopping at all the sights between Cairo and Abu Simbel.

These river river-going sailboats were common in Egypt in the days of the monarchy (1920s40 1920s40-s) when travelers loved to cruise the Nile in style. Until the 1870s, the dahabiya was the standard for tourists to travel up and down the river Nile. By 1900, as trains had started to compete with the steamboat, dahabiyas were reserved only for the most wealthy, leisured travelers.