Karmiel was one of the first cities in Israel to be established according to an urban master plan. It was built as part of the Central Galilee Development Project. Work began in 1963, and the official inauguration ceremony took place in October 1964. The first 16 families moved in at that time. A tender for the construction of Karmiel's main roads was issued in 1963, and Mekorot built a water pipe network connecting Karmiel, Rameh, Sha'ab and other nearby villages. In 1972, Karmiel was granted development town status, which bolstered its growth due to government-provided economic incentives to attract young couples.