Gujrat was founded by Raja Bachhan Pal Gurjar in 460 BC, according to General Cunningham, the British historian. Historical consensus is that it existed in the time of Alexander the Great, and that the city's Raja Porus p** up a fierce challenge to Alexander's invasion at the bank of the Jehlum River. The establishment of Gujrat City was realised early in the 19th century after the British Empire and in support of regional landlords (e.g., Daswandi Khan of Daswandi Pura).
Gujrat became a part of the Muslim Sultanate of Delhi when the Afghan noble Sultan Shahab-ud-Din Muhammad Ghauri conquered Punjab in 1185. Gujrat slowly developed as medieval town and manyMuslim Sufi missionaries converted the local Gurjar population to Islam. During the Mughal period, Mughal royalty frequently travelled through the district en-route to Kashmir. When King Jahangir died while he was returning from Kashmir, the news of his death was suppressed to avoid any chaos in the empire. His abdominal organs were taken out and buried in Gujrat. To this day, an annual festival is held commemorating this event, commonly known as the "Festival of Jahangir".
Shah Daula is a Sufi saint of the city and he met Sikh's aixth Guru Gobind Singh (1595–1644) when he was passing though Gujrat. After the decline of the Mughal Empire, the Sikh invaded and occupied Gujrat. The Muslims faced severe restrictions during the Sikh rule. The Sikh army under Sardar Gujjar Singh Bhangi in 1765 defeated the Gakhar ruler of Gujrat and annexed it to the Sikh Territories. From 1765–1846 Gujrat was controlled by the Sikhs.
Two main battles between British and Sikh armies were fought in this district: the Battle of Chillianwalaand the Battle of Gujrat. Only after winning the battle of Gujrat on 22 February 1849 did the British declare victory in Punjab.
The predominantly Muslim population supported Muslim League and Pakistan Movement. After theindependence of Pakistan in 1947, the minority Hindus and Sikhs migrated to India while the Muslimrefugees from India settled in the Gujrat district. Muslims refugees from East Punjab, Haryana, Jammustarted arriving and crossed the border in to Pakistan; many were given land in Gujrat District to settle.
There are many historical buildings and ruins in and around Gujrat. The Grand Trunk Road, commonly abbreviated as G.T. Road, built by emperor Sher Shah Suri, also passes through Gujrat. The road still exists today, along with its period stone wall. Historical buildings and ruins can be found in nearby towns throughout the area.