Construction of Naghlu Dam was financed and supervised by the Soviet Union between January 1960 and 1968. The first generator was commissioned earlier in 1967. After the 1992 collapse of the Soviet-backed Democratic Republic of Afghanistan, the power station was used by supporters of Gulbuddin Hekmatyar as a tool to deprive Kabul of electricity. The power station fell into disrepair during the late 1990s, which provided very little electricity. After the 2001 U.S.-led invasion only two generators were operational.