The Second Palace was built in the northwestern part of the Arg Fortress for the family of Babrak Karmal. Previously, there was a two-story yellow building at this location, which housed the offices of various ministries. During the reign of Mohammad Daoud Khan, it also served as the office for organizing affairs within the Arg. This building, constructed in a classical style, gradually became outdated and was no longer functional. As a result, in 1358 (1979), construction of the Second Palace began on the same site.
During President Hamid Karzai's tenure, the palace was renovated with the efforts of his advisor on presidential security and protection, Mrs. Rameeka Ahmad. It was then used to accommodate foreign dignitaries. Whenever high-ranking foreign visitors traveled to Afghanistan, they would stay in this palace.