The Lead Mosque was built in 1773 by the Albanian pasha Mehmed Bushati, a member of the noble Bushati family and ruler of the Shkodra Pashalik. The mosque was intended to give the city the appearance and status of a capital. According to tradition, it was constructed on land belonging to the Catholic Church.

Mehmed Bushati personally oversaw the building process, making sure each stone was carefully shaped. The first imam, Haxhi Ahmet Misria, who was of Egyptian origin, came to Albania through his ties with Mehmed Bushati. He was followed by other imams who continued to maintain the mosque.

By the early twentieth century, the building had suffered damage, and the lead covering of the domes was gradually removed. In 1916, during the Austrian occupation, the remaining lead was taken by the Austrian army.