Originally Chatham Alley, this street used to serve as a one block connector between East Pettigrew and Glenn Streets. After the creation of Gann Street and the elimination of this portion of Glenn Street for the Durham Freeway, it became a short connector between Gann and East Pettigrew.
The street was named for the Chatham Knitting Mill, which it ran directly behind (to the west of.) It may also have led to the briefly-extant Mill No. 2. building.