One of the stations around Timsah never in fact to be built was named Lessepsville; another, soon to be abolished, was named Toussoun, after the Viceroy's young son. Situated to the south of Lake Timsah, it served as a general supply center for the works of this sector, and the Consular observer found it reasonably well organized. Throughout the night colored lights were hoisted to guide Arabs bringing in fuel from the desert; throughout the day bells were rung at regular times to mark the shifts of the native  Egyptian workmen. Pains had been taken to lay out some kind of a garden, the soil being frequently washed to remove saline deposits and irrigated by a windmill with water which was drinkable only by camels. Here too was a forge for the manufacture of minor utensils, and a pound containing livestock sheep, bullocks and innumerable fowls. The whole station was subject to diseases of considerable virulence, the most formidable being dysentery.

Some two hundred Europeans in all were at work in the Isthmus, men from all quarters of Europe with difficulty held together by the mere hope of gain. For the present their salaries were so low as to bar any hopes of profit sufficient to counterbalance the daily sacrifice of comfort and society, and many would leave, disillusioned, when the first flush of enthusiasm wore off. often taking their frustrations on the Egyptian fallahiyn laborers, whom they regarded as the refuse of the native population and  whose " insolence" provoked them!.

Now De Lesseps, starting on a tour of the northern half of the Isthmus, proceeded across the shallows of Lake Manzalah into a landscape once watered by a branch of the Nile . Thus he reached al-Qantarah, the start of the caravan road into Syria. This station, designed to become a large depot of machinery, would be directly linked with Port Sa`yid as soon as the dredgers had cut a twenty-five mile service channel through the mud of the lake, and another dredger had been brought overland in sections to be reassembled and start the work from this end of it. Meanwhile a preparatory channel had been excavated by hand. The Egyptian laborers, familiar with the mud of their lake and its habits, scooped it up in large handfuls, pressed it against their chests to squeeze out the water, and when dry piled it in lumps, one on top of the other.

From al-Qantarah De Lesseps proceeded southwards through a dry swamp which was to become Lake Ballah-an offshoot of Manzalah to the sand dunes of al-Firdan, whose excavation was soon to start, and where now, as at al-Qantarah, complete well-being, gaiety and good health reigned. Continuing his journey to the south, he explored the basin of Lake Timsah, twenty feet below sea-level and dried up for centuries past, but now destined within measurable time to be filled by the waters of the Mediterranean. Here, nearly half-way between the two seas, where the sea water canal from the north would meet the Sweet Water Canal from the west, lay the site designed to be the principal inland port of the Isthmus.

Looking across this gaping void of sand and gravel and blackened sun-cracked earth, Lessees saw as in a mirage the day when it would "shelter the fleets of all the world". On its western rim he marked out, with his party, the lines of a town which would be known as al-Isma`yiliah, after Muhammad Sa`yid's successor, Isma`yil. 

Southwards they looked down towards the bluish silhouette of the `Attaqah mountains, which rose above the Gulf of Suez. Between lay the Bitter Lakes, to be linked with Timsah by a stretch of the Maritime Canal and with Suez by another, while the line of the Sweet Water Canal would turn south, to run parallel with both. Such was the plan for the second phase of the works, planned to begin when the northern half had reached a certain stage of completion.

Few technical difficulties stood in the way of the construction of the Suez Canal. It was to be cut in a relatively straight line, through some sixty miles of water and forty miles of land-three large lakes and three stretches of desert between them. The land was in fact a natural depression, parts of which must in the past have held water. Everywhere the soil was easy enough to work, being composed of sea-sand in the north, and gravel and clay in the south, with here and there layers of gypsum (useful for the making of lime), but nowhere, it seemed, more than an insignificant trace of rock.

In the bed of the Bitter Lakes lay a large deposit of crystallized salts, from the days when the Red Sea flowed into them. The land was level enough to require no cuttings except through three ridges or plateaux across the path of the Canal, none higher than forty feet above sea level. These were at al -Gisr, between al-Qantarah and Timsah; at the Serapeum, between Timsah and the Bitter Lakes; and at Shaluwf, between the Bitter Lakes and Suez. Only one of these cuttings was seriously to tax the skill of the engineers that of al-Gisr where the work was to take longer on account of the problems of excavating soft sand.

Otherwise the technical challenge of the Suez Canal lay less in the piercing of the Isthmus itself than in the construction of its artificial port, on the Mediterranean. Here nature had provided no inlet from the sea to LakeManzalah. Nor was there any land but a thin strip of beach, sometimes no more than a hundred yards wide, with the waves washing over it. Moreover the bay, like the lagoon, was exceptionally shallow; ships could only lie three miles out; and any attempt to dredge a navigable channel would be threatened by the prevailing current from the north-west with deposits of silt from the Damietta branch of the Nile.

Port Sa`yid thus had to be built up from nothing by man, in defiance of the forces of nature, and with the assistance of no local building materials. It was to be contained within a western breakwater, built to enclose 450 acres of water. First, the pioneers erected a lighthouse some eighty feet high, made of timber and designed for a revolving light, which would be visible fifteen miles offshore. Then they threw out a jetty, built on piles, of which the larger were not merely driven but screwed into the mud and the sand of the sea-bed. This was some five hundred yards long, but was planned to extend to two miles. Out beyond it an island, to which the jetty would ultimately be joined on completion of the western breakwater, was built from heaps of stone. But, as had now been proved, there was almost no stone in the Isthmus, none nearer than the `Attaqah quarries at Suez, which were still inaccessible. Until later, when a form of concrete was made on the spot, from imported lime and local sand, all the stone for the new harbor had to be brought from the quarries of al-Maks, beyond Alexandria, a journey of 150 miles by sea.

The initial problems of the construction of Port Sa`yid were thus problems less of engineering than of transport in essence, problems of organization; and the same applied at this stage to the construction of the Canal as a whole. Uppermost in the minds of the Company's team, throughout these first three years, were the difficulties of supplying builders with materials, workshops with tools and machinery-above all workers with food and water, a commodity as scarce as stone.

These were years when the choice lay literally between life and death, not merely for the scheme as a whole but for the men engaged in it, tens of thousands of whom would be laboring if in a waterless desert. In search of water, wells had been sunk from one end of the Isthmus to the other. But with a few exceptions the water found was so saline and bitter as to be undrinkable by man, and often even by camels. It was to meet this problem that the Sweet Water Canal was designed, and the rigole, the service channel, which between them would supply water along the whole line of construction. 

But several hard and thirsty years must elapse before the completion of either. The Sweet Water Canal was at last to be finished in February 1862, bringing fresh water to the heart of the Isthmus for distribution to the stations around. Later that year a pumping station was established at its junction with the lake, which conveyed water by pipeline along the salt water stretch of the rigole to Port Sa`yid; and at the end of 1863 the southern, fresh water half of the rigole was to reach Suez. Meanwhile, since men must work and the Canal must grow, machines were introduced for the condensation of steam into water, which was often of inferior quality. But still the greater part of it had to come overland, for long distances and at great cost, from the Nile valley by fleets of boats across Lake Manzalah, and by daily caravans, across the desert, carried by thousands of camels. 

But a crucial problem still confronted the Company that of the supply of the labor itself. It was all along Britain's firm intention, agreed between Bulwer and Lord John Russell, to arrest the Canal works by any means, in alliance with the Porte, now their pretext was that they were against the use of forced labor in the Isthmus. 

Officially, the first indication of this policy was given in the House of Commons on June 25, 1861. To a question by Mr. Darby Griffith as to whether the practice accorded with the various "humane edicts of the Ottoman  Empire", Russell replied that the British Government had objected to it at the Porte, and was now investigating the position in Egypt itself. Meanwhile however the Viceroy, who was obliged under the terms of the Concession to supply the Company with labor, remained reasonably consistent in evading such pressure.

In the winter of 1861 De Lesseps, with a shrewd sense of timing, conducted the Viceroy on a tour of the center of the Isthmus, which disposed him towards further requisitions of forced labor. He was happy to sail down the Sweet Water Canal, gave orders to his Governors for the forced labor required for its completion to Timsah, and started to talk of its continuation, independently of the service channel, as far as Suez a work which should serve De Lesseps as a pretext for an extra levy of 100,000 men. The Viceroy made a triumphal entry into Toussoun, in a carriage drawn by six mules and preceded by a cavalcade of richly caparisoned dromedaries. His stalwart Viceregal Guard, 250 strong and mounted also on dromedaries, preceded him as he drove through two long ranks of Fallahiyn laborers. 

Adding their voices to the strains of an Egyptian military band, they cried out "Long live Sa`yid!" Before returning to Cairo he was presented with specimens of the various plants grown on the land which it had proved possible to irrigate-a load of maize, cabbages, cauliflowers, watermelons, radishes, potatoes, grasses, and a variety of ingredients for salads.

Early in the following year, the Sweet Water Canal was completed as far as the Lake. But the sea water rigole from Port Sa`yid  took longer, on account of the obstacle placed in its way by the plateau of al-Gisr. This was a huge dune of sand, some thirty feet high and ten miles broad, constantly shifting and thus tending to fall in wherever a space was dug out. To maintain a cutting through it involved the ultimate excavation of 50 million cubic yards of sand, a task which was to take almost as long to complete as the whole of the rest of the Canal. But, thanks to the labor force now available, enough of it was removed by hand and a preliminary channel cut deep enough to take, by the end of that year, a stream of water, still shallow but just deep enough to permit the operations of dredgers.

On November 18, 1862, at eleven o'clock in the morning, the waters of the Mediterranean flowed into Lake Timsah.

A special train, graciously provided by the Viceroy, transported Lesseps and his guests, who included the Consular representatives of the European countries, from Cairo to Zagaziyg. Next day they visited the "Wadiy lands", by the old Canal between Zagaziyg and the Nile, which the Company had bought from the Viceroy. Acquired for the dual purpose of supplying Nile water to the Sweet Water Canal, and irrigating new lands for the shareholders' profit, they were developing into a fine agricultural domain. Thence the party was conveyed down the Sweet Water Canal to the growing town on the shores of the lake, destined to become the town of al-Isma`yiliah but still named Timsah.

On the landing-stage they were welcomed by the national anthems of France and of Britain "as it were", De Lesseps recorded, shrewdly an invitation to union, on the very ground lately believed to be a source of discord between the two countries.

They then proceeded to the spot where the Canal, having at last penetrated the intractable plateau of al-Gisr, was to join the lake. Here a triumphal arch had been erected in honor of Muhammad Sa`iyd, at the end of an avenue of columns adorned with agricultural implements. This led to a Viceregal kiosk, built at his command and now surrounded by Venetian masts, from which fluttered bright-coloured pennants. Beyond, at the foot of a long low ridge, which was to become the Asiatic bank of the Canal, lay a trench, containing a stream of water fifteen meters wide-salt water from the Mediterranean, ready at the appointed moment to precipitate itself into Lake Timsah.

Deputizing for the Viceroy, Isma`iyl Bey, his heir-apparent, presided over the men whose years of toil had achieved this consummation, together with the Grand Muftiy of Egypt, the principal `ulama' of Cairo, the Shaykh al-Islam, and the Catholic Bishop of Egypt, with his clergy around him. De Lesseps called for silence. Then, addressing the laborers massed on the dyke, which still dammed the waters, he proclaimed: `In the name of His Highness Muhammad Sa`iyd, I command that the waters of the Mediterranean be introduced into Lake Timsah, by the grace of God!'

All eyes were turned on the dyke. In a solemn silence the workers cut the dam. Then, with a cascade of water and an avalanche of soil, the Canal broke through into the lake. There was a roar of enthusiasm. The "Bravos !" of the French vied with the "Hurrahs!"of the English. Tears coursed down sun-bronzed cheeks as a band broke into the Egyptian national anthem; the `ulama'called loudly upon Allah, and the Grand Muftiy intoned a sonorous fatwah, for repetition throughout the mosques of Egypt:
 

De Lesseps afterwards wrote of the occasion:

What was omitted from this momentous occasion was, that in order to achieve this "murderous enterprise", ten of thousands of Egyptian fallahiyn were dying, under the merciless rule of forced labor.