The Ahluwalia took its name from the village of Ahlu near Lahore. Its head from 1748 was Jassa Singh Ahluwalia, who was raised in the household of Nawab Kapur Singh Ji and was given command of the Dal Khalsa.
He was called Sultan-ul-Qaum, king of the community, by the Khalsa. He led the assault that retook Amritsar, was present at the Vadda Ghallughara in 1762 and was wounded many times, and struck the Khalsa coin at Lahore in 1765.
The misl's territory came to centre on Kapurthala in the Doaba, which became a princely state and survived until 1947. Its later rulers built the Jagatjit Palace on the model of Versailles and the Moorish mosque, and the state was among the most conspicuously Europeanised in India.
The Ahluwalias were Kalals by caste, distillers, and the rise of a Kalal to the leadership of the Khalsa is one of the sharper facts of the eighteenth century in a region that has never stopped counting caste.
He died in 1783 and is buried at Amritsar. The misl passed to his relatives and never again held the position in the Dal Khalsa that he had held.
Its holdings were in the Jalandhar Doab and around Kapurthala, and after 1809 the Cis-Sutlej part came under British protection while the rest was left as Kapurthala state.
Kapurthala survived to 1947 and was merged into PEPSU in 1948. It is one of a handful of misl-period states that lasted, along with Kalsia and the Phulkian states of Patiala, Nabha and Jind.