This was one of the earliest inhabited settlements on the Zaria plains, which played an important role in the formation of Birnin Zaria. It is situated to the north-eastern part of the Birni wall near the Bai gate. Archaeological evidence in the form of stone implements demonstrated that Madarkachi must have been in existence by the late Stone Age period. The inselbergs in the area with its many advantages seemed to have provided favourable conditions for human habitation by the first millennium A.D. and its subsequent development into an urban centre. Some of these advantages included natural security provided by the inselbergs against the enemy. The use of inselbergs for defence purpose was a common feature in Hausa land due to the insecurity caused by the great movements of people across Hausa land following the desiccation of the Sahara. The hill was also of religious importance as the rocks were regarded as sacred places which were essential for the worship of the iskoki (sprits). The fertility of the soil at the site and the presence of a constant source of water supply that characterized the area were also important factors in the emergence of the early settlement of Madarkachi. Apart from the above functions, the Madarkachi hill also performed other unique function. This was because it served as the Fanisau of the Sarakuna of Zazzau. Fanisau is a Hausa word, which means a resting place for the rulers of Zazzau. This was probably when Madarkachi ceased to be a citadel of power following the unification of the settlement with Kufena.
Local traditions ascribed the foundation of Madarkachi to Madara who was said to be a giant hunter. It was from his name that the site derived its name as discussed above.
The expansion in agricultural productions, trade, commerce and the growth of other industries, led to rapid demographic growth of Madarkachi. This development seemed to have stimulated the expansion of human settlements on the plains away from the nucleus of the settlement on the hill and its immediate surroundings to as far as Fadamar Bono when Madarkachi became spatially inadequate. Thus, Madarkachi played an important role in the emergence of Birnin Zaria as a result of its rapid expansion and incorporation into the capital city of the state of Zazzau.