Philadelphia Alley became a public street after the fire of 1810

Francis Kinloch bought three parcels of land on the north side of Queen Street between 1751 and 1766. He built a family house facing the street and constructed four rental houses behind it. To reach these rentals, he cut a private lane through the property known as Kinloch's Court. In his 1766 will, he left the land in trust so his widow, son Cleland, and daughter could live in the tenements rent-free for the rest of their lives.

Fire destroyed the court on 13 June 1796, and a second fire swept through the neighborhood on 7 October 1810. The narrow, crooked lanes hampered the volunteer firefighters and militia artillery trying to stop the flames. On 24 October 1810, citizens met at the Exchange Building and petitioned to widen and straighten the streets. The South Carolina General Assembly passed act number 1971 on 20 December 1810, authorizing the city to open the court as a public street. On 30 January 1811, City Council formally renamed it Philadelphia Street.

While local stories often describe this lane as a dueling ground, the name likely honors either the $6,000 and subsequent $2,000 in relief funds sent by Philadelphia after the 1810 fire, or the years that the alley's owner, blacksmith William Johnson senior, spent living in that city during the American Revolution.

Regarding the dueling reputation, Dr. Joseph Brown Ladd and his former friend Ralph Isaacs met with pistols on 23 October 1786. Ladd fired over Isaacs's head, but Isaacs shot Ladd in the leg. The knee shattered, gangrene developed, and Ladd died on 2 November 1786.

William Johnson junior, who owned the land during the renaming, was appointed to the United States Supreme Court by Thomas Jefferson in 1804.