The palace, considered an architectural heritage site and a significant tourist attraction,[2] was built in the mid-19th century to replace an earlier-dated fort located nearby.

[3] The town of Khaplu is located in the eastern part of Baltistan, at an altitude of 2,600 metres (8,500 ft) above sea level and is the administrative capital of the Ghanche District.

After the Maharaja of Kashmir assumed control of the region, this custom was changed, which led to an end to hostilities between the local kings.

The troops of Murad besieged the fort for three months, resulting in the surrender of Rahim Khan, the 62nd Yabgo dynasty ruler of Khaplu.

[6] Being on the border of multiple regions, the structure of the palace has Tibetan, Kashmiri, Ladakhi, Balti, and Central Asian influences.

[6] A carved wooden gate that Yabgo Raja Hatim Khan took from a fort in Skardu after conquering most of the Baltistan[15] was erected at the entrance of the palace.

The passage beyond the main gate, which formerly housed a stable, leads to the front lawn of the palace, which was used by the musical band during festivities in the reign of Yabgo Rajas.

The hotel has 21 rooms, six of which are located inside the palace building and utilise its 70 percent of income for the development of the Khaplu region,[5][17] while another area serves as a museum.

[6] The rescue and renovation work of the palace was commended by Virgin Holidays for having social and economic effects on the locals of the area.