The William Penn Highway was organized as an alternative to the Lincoln Highway being parallel to the Pennsylvania Railroad west of Harrisburg. The route's New York Extension was adopted in 1916. The Pennsylvania Department of Highways assigned the Pennsylvania Route 3 designation to this road in 1924, and in 1926 it became part of U.S. Route 22 when the United States Highway System was formed, The road became problematic for motorists in Lebanon along the current U.S. Route 422; Reading via U.S. Routes 22 and 222; and Allentown on Hamilton Street (US 22). The highway continued through Allentown on Hanover Avenue and through Bethlehem on Broad Street, Linden Street, and Easton Avenue.