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The city was named after a saint, Hazrat Baba Mian Channu (Rehmatallah Alahay) who lived and buried there. There is a folklore about the name that during English rule administration tried to change the name of city. They painted all boards with the new name. But at night somehow the boards changed to back to the original. They tried repeatedly in vain, and since then the name of area is Mian Chunnu.(Subhan Allah)
Mian Channu town is well planned city, which was designed by Mr Banerge in 1918. Main buildings were constructed by the government, like main grain market, educational institutions, medical unit, railway station, fruit mandi, park and a public library. A Mosque, a temple and Gurdwara was built to perform religious obligation for all communities. In the year 1919, it was declared as a notified area Committee and in 1938 as a Town Committee. Its limits were last extended in the year 1950. Since then no extension has been made and the development in the Town from 1947 to 1961 remained slow. It was assigned of Municipal Committee in 1975, as it had grown into small urban centre by that time. After that the Town started developing and major growth has been taking place from 1972 to 1984. But the trend of growth in this period has largely been along G.T Road and in the northern direction. It has been the headquarters of the Mian Channu Tehsil of Khanewal District since 1985 and is administratively subdivided into 3 Union councils. It has approximately 65,000 residents and is located on the Grand Trunk Road (250 km South West of Lahore and 1050 km North East of Karachi) and KLP (Karachi, Lahore, Peshawar) railway line. For a period of more than a century, Mian Channu has been part of District of Multan. With the raising of status of Mian Channu to a tehsil headquarters and creation of a new District of Khanewal from 1 July 1985, Mian Channu Tehsil become a part of the new District of Khanewal. The city is one of the major contributor to agricultural production. Cotton, wheat and mango are the major agricultural products. Major crops of the town are wheat, grain, peas, barley are the important crops of Rabi season, while Kharif crops are cotton, sugarcane, jawar, bajra, oil seeds which are shipped by rail and road to other parts of the country.
Pakistan's first agricultural tool industry was established in Mian Channu with the name Ghazi Industries Ltd, founded by Ghulam Mustafa Ghazi. He was well known industrialist as well as freedom fighter of 1947 freedom struggle.
It is the paternal hometown of famous Indian writer,columnist and journalist Late Mr. Khushwant Singh and he spent his childhood days under there intermittently with his grandmother and father.