After his conquest of the Hariphunchai kingdom, King Mangrai established Wiang Kum Kam as his new capital in 1294, situated on the eastern side of the Ping River. However, due to frequent flooding, he decided to move the capital. He selected a location near Doi Suthep, where an ancient Lua people's town once stood. By 1296, construction began on Chiang Mai, meaning "New City", which has remained a significant capital in the northern region ever since.

King Mangrai founded Chiang Mai in 1296, making it the central hub of the Lan Na kingdom. Under his rule, the Lan Na territory expanded to include areas of present-day northern Thailand, with a few exceptions. His reign also saw influence over regions in Northern Vietnam, Northern Laos, and the Sipsongpanna area in Yunnan, which was his mother's birthplace. However, the peace was interrupted when King Boek of Lampang, son of the displaced King Yi Ba, launched an attack on Chiang Mai. In a dramatic battle, Mangrai's son, Prince Khram, faced King Boek in an elephant duel near Lamphun. Prince Khram emerged victorious, forcing King Boek to retreat. Boek was later captured while trying to escape through the Doi Khun Tan mountains and was executed. Following this victory, Mangrai's forces took control of Lampang, pushing King Yi Ba to relocate further south to Phitsanulok.