[6] Construction of the Darul Aman Palace began in the early 1920s as part of the endeavours of Emir Amanullah Khan to modernise Afghanistan.

The palace was to be part of the new capital city called Darulaman, connected to Kabul by a narrow gauge railway.

[9] The palace is an imposing neoclassical building on a hilltop overlooking a flat, dusty valley in the western part of the Afghan capital.

[10][11] The Swedish memoir writer Rora Asim Khan, who lived in Afghanistan with her Afghan husband in 1926–27, describe in her memoirs how she was invited to the palace by Queen Soraya to describe Western lifestyle and customs to the Queen and the King's mother[12] Intended as the seat of a future parliament, the building remained unused and partially complete for many years after religious conservatives under Habibullah Kalakani forced King Amanullah from power in 1929, and halted his reforms.

Heavy shelling by the Mujahideen left the palace a gutted ruin, including the garage containing the vehicles of the former King which were removed and used as target practice, all ultimately being destroyed.

[17] Eventually it was decided to develop a new building opposite the palace to house the parliament under a grant, provided by India.

In the Spring of 2016, work began on a 16 to 20 million dollar restoration project,[18] intended to renovate the palace in time for the centenary of Afghanistan's full independence in 1919.

[2] On 18 April 2020, an opening ceremony was held as the palace was used as a temporary COVID-19 isolation and treatment center with 200 beds during the COVID-19 pandemic in Afghanistan.