Completed July 8, 1910, the Loop Canal marked the end of a long journey for vacationers traveling to Bethany Beach in the town's early days. Arriving in Rehoboth by railroad, travelers would continue their voyage by boat, crossing Rehoboth and Indian River Bays to the U. S. Government (Assawoman) Canal. For a time, the final portion of the trip was completed in a two-horse drawn bus through the deep sand to the town. In an effort to improve travel conditions, a shallow waterway was dredged from the Assawoman Canal to this location. Approximately 1½ miles in length, it was constructed by the Bethany Beach Improvement Company, an organization of developers and property owners. With the opening of the canal, travelers could complete the final leg of the journey by boarding a single boat in Rehoboth. Since the shallow-draft motorboat Allie May could not back up, a loop was formed here at the First Street dock to allow the boat to turn around for the return trip.