As the people suffered under the terror of the Turks, this led to First Serbian Revolution in 1804. Rebels faced the lack of guns, ammunition and other martial equipment. For that reason, leaders of the Revolution, guided by Karadjordje Petrovic, set their priority task – to organize army and supply it with guns. In 1808, in the Arsenal in the Lower Town of Belgrade Fortress, light mobile guns of domestic design were cast. Those were so-called "Hajduk" cannons.

At the end of 1832, State Military Workshop was built. Guns were assembled there from the parts produced in workshops, with specialist craftsmen. Not long after that, the Arsenal for repair of handguns was built and then gun powder warehouse, forging plant and locksmith plant. In 1847, the whole complex was reorganized into the Factory for military equipment.

Aware of specific international position of the Principality of Serbia, Ilija Garasanin renewed the idea of independent production of cannons in1848. At the end of 1849, first steam engine of 15 kW was ordered from Belgian company La Chausse for the needs of the Gun foundry. Turkey and Austria energetically protested against the Gun foundry, so the Ministry of Interior  on March 11, 1851. suggested Kragujevac be a location for the Gun foundry and on March 17 prince Aleksandar Karadjordjevic explained to the Ministry of Finance the reason for choosing this location. All installations of the Gun Foundry were moved to Kragujevac by the end of the month.

Francophiles Konstantin Magazinovic and Ilija Garasanin managed to get the approval of emperor Napoleon III on the engagement of controller of a private gun foundry from Douai, France, Charles Loubry. Lubry left Paris on January 5, 1853, and arrived in Belgrade on January 28, 1853. Four days later, he signed the contract on the engagement for the manager of the Gun Foundry that is buing built and went to Kragujevac immediately.

On October 27, 1853, first cannons were successfully cast in Gun Foundry in Kragujevac. This date represents the date of foundation of Zastava Arms and the start of industrialization in Serbia.