Initial renovations destroyed one of the museum's most well-known artifacts, a room of murals painted by Madhubani artist Ganga Devi, leading to widespread criticism.

[4] It was set up over a period of 30 years starting in the 1950s and 60s by the efforts of Kamaladevi Chattopadhyay, when the area was envisaged as an ethnographic space where craftsmen from various parts of India would come in to work towards preservation of various traditional arts and crafts.

[5] Today the museum holds over 35,000 rare and distinctive pieces reflecting the continuing tradition of Indian craftsmen through painting, embroidery, textiles, various crafts of clay, stone and wood, all housed in a building designed between 1975 and 1990 by architect Charles Correa,[1][6][7] incorporating traditional architectural vocabulary into a modern design.

In 2015, the Government of India announced that it would be creating a new Hastkala (handicrafts) Academy to train artisans on the Crafts Museum campus, converting existing galleries into classrooms.

In the 1990s, the Crafts Museum commissioned renowned artist and Padma Shri Awardee Ganga Devi to paint the internal walls of a room in the traditional Madhubani style of art.

The project, completed over six months, was undertaken while Ganga Devi undertook a residency at the Crafts Museum, while simultaneously being treated for cancer, a year before her death.

The Village Complex also has open walls along the corridors & passages which are used as the canvas to display the painted traditions of several tribes of folk artisans.