Like some other villages around Benin City such as Ego, Use, Oka and Ihimwirin, to mention a few, the foundation and growth of Uselu dates back to the period of the Ogiso. But its significant position in the history of Benin did not come into limelight until the Palace of Edaiken (Eguae-Edaiken) and the Palace of the Queen mother (Eguae-lyoba) were established there during the reigns of Oba Ewuare and Oba Esigie respectively. Uselu is therefore divided into two sections: the upper Uselu where the Eguae-Edaiken is situated and lower Uselu where Eguae-lyoba is established.

Oba Ewuare the Great sent his senior son, Kuoboyuwa, to hold brief for a man called Iken of Uselu, who was a strong powerful warrior who constantly challenged the authority of the Oba and he often prevented Uselu people from paying the annual tributes to the Oba in Benin City. As a result of this opposition constituted by Iken, Oba Ewuare wanted to eliminate him by sending him to the battle front during the war between Benin and Owo. Kuoboyuwa, the senior son of the Oba was to hold brief for him during the period.. Iken won the war but he was killed on his way back.

Oba Ewuare the Great sent his senior son, Kuoboyuwa, to hold brief for a man called Iken of Uselu, who was a strong powerful warrior who constantly challenged the authority of the Oba and he often prevented Uselu people from paying the annual tributes to the Oba in Benin City. As a result of this opposition constituted by Iken, Oba Ewuare wanted to eliminate him by sending him to the battle front during the war between Benin and Owo. Kuoboyuwa, the senior son of the Oba was to hold brief for him during the period.. Iken won the war but he was killed on his way back.

When the Oba realised that Uselu people would react violently if Iken failed to return from the war front, he decided to make the position of his son a permanent one to enable him assume full responsibility of the ruler of Uselu. He therefore conferred on him the title of Edaiken (Edayi Ni Ken) that is the person holding brief for Iken. The Palace of Edaiken was established there.

Oba Esigie started this tradition probably to forestall the conflict that would have arisen between his mother and himself over the exercise of political power. An almost independent domain of the Queen mother was therefore carved out for her. Thus it has become strongly -established in Benin tradition that a year or two after the coronation of every Oba, he invests his mother with the title, lyoba (Queen mother) and sends her to reside at lower Uselu in Eguae-lyoba (Palace of the Queen mother). If it happens that the mother dies before the coronation of the son, the body is preserved till a year or two after the coronation to enable the Oba confer the title lyoba on her and later bury her at Eguae-lyoba.