The Palestine Military Railway, operated by the British, needed new mixed traffic locomotives in World War I since their existing British mineral engines were not powerful enough for future needs. Since British manufacturers did not have enough capacities, the order went to Baldwin. In the short period in October and November 1918, they built 50 ten-wheelers.

In 1920, they came to the civil Palestine Railways and were designated class H. Due to missing turntables, six were brought to Armstrong Whitworth in 1926 to rebuild them into 4-6-2T tank locomotives which were designated class H2. Six others received copper fireboxes at the same company, while again others were fitted by the PR itself with Belpaire fireboxes. Between 1937 and 1938, the class H3 was created by the PR by rebuilding five to 4-6-4T tank locomotives. 

In World War II, when Palestine found it hard to acquire Welsh coal, they started to convert all to oil firing. This process was completed in 1943. With the founding of Israel in 1948, 44 remaining locomotives came to Israel Railways. These were 33 original class H locomotives, six H2 and five H3. The last ones were withdrawn around 1960.