The Palace, in the heart of the old city of Rhodes, was built by the Knights of St. John of Jerusalem, who ruled the island from 1309 to 1522. The fortress was the seat of the head of the order, the Grand Master. It was rebuilt in the 1930s.

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The Knights of St. John were a Christian military organization founded to protect the Holy Land after a European army captured Jerusalem from Moslem forces in 1099, during the First Crusade. Following the fall of Jerusalem to the Muslim Seljuk Turks in 1187, the order moved its headquarters to Rhodes. The Turks captured the island in 1522, forcing the Knights to move to Malta.