Paleogenomic data has informed us about the movements, growth, and relationships of ancient populations. It has also given us context for medically relevant adaptations that appear in present-day humans due to introgression from other hominids, and it continues to help us characterize the evolutionary history of humans. However, ancient DNA (aDNA) presents several practical challenges as various factors such as deamination, high fragmentation, environmental contamination of aDNA, and low amounts of recoverable endogenous DNA, make aDNA recovery and analysis more difficult than modern DNA. Most studies with aDNA leverage only SNP data, and only a few studies have made inferences on human demographic history based on haplotype data, possibly because haplotype estimation (or phasing) has not yet been systematically evaluated in the context of aDNA. Here, we evaluate how the unique challenges of aDNA can impact phasing quality. We also develop a software tool that simulates aDNA taking into account the features of aDNA as well as the evolutionary history of the population. We measured phasing error as a function of aDNA quality and demographic history, and found that low phasing error is achievable even for very ancient individuals (∼ 400 generations in the past) as long as contamination and read depth are adequate. Our results show that population splits or bottleneck events occurring between the reference and phased populations affect phasing quality, with bottlenecks resulting in the highest average error rates. Finally, we found that using estimated haplotypes, even if not completely accurate, is superior to using the simulated genotype data when reconstructing changes in population structure after population splits between present-day and ancient populations. Availability All software used for simulation and analysis is available at github.com/Jazpy/Paleogenomic-Datasim