Originally constructed as a Muslim palace in the medieval Islamic stage of the Balearic Islands, the 12th-century building is one of Palma's oldest. Archaeological studies tell a rich history of at least seven stages of the building, stretching over nearly a thousand years.

The original Muslim palace from medieval times was organized around two symmetrical interior patios that have been maintained as a guideline to the present. In the reception of Nobis Hotel Palma, guests can admire a wooden Alfarje - a paneled ceiling with a decorative element of the Arabic calligraphy Nashk writing, intended to protect its inhabitants - that miraculously survived a 13th-century fire, an earthquake, and all later stages of constructions. At the time of its original construction, the Sant Jaime Church which is today a neighbor of Nobis Hotel Palma was one of Mallorca's most prominent mosques, built as part of the Muslim Palace.

After the Christian conquest in Mallorca in 1229, the building functioned as a fortification that included a neighboring house, before it was ordered to be burnt down by King Alfonso III of Aragón at the end of the 13th century. The site remained in ruins for at least 100 years and later became private homes for noble Majorcan families. The palace was rebuilt in a Gothic style in the mid-15th century and later reformed as a baroque-style palace in the 17th century.

The transformation of the historical building has been done together with architects at Wingårdhs, the award-winning firm under the leadership of famous Swedish architect Gert Wingårdh and architect Helena Toresson, and Spanish architect firms Jordi Herrero Arquitectos and Eduardo Garcia Acuna Arquitectos.