Built on the site of a hill variously known as Spirii Hill, Uranus Hill, or Arsenal Hill, which was largely razed for the project, the building anchors the west end of Unirii Boulevard and Centrul Civic. Construction began in 1984. The building was originally known mainly as the House of the People (Casa Poporului), and sometimes as House of the Republic (Casa Republicii), and was intended to serve as headquarters for all the major state institutions. However, the project was just nearing completion at the time of Nicolae Ceauşescu's 1989 overthrow and execution. During the 1989 regime change, its leaders refered to the building as the House of Ceauşescu, using it as an example of the excessive luxury in which Ceauşescu would have been living.
Since 1994, the building has housed Romania's Chamber of Deputies that had previously been housed in the Palace of the Patriarchy; the Romanian Senate joined them there in 2004, having previously been housed in the former Communist Party Central Committee building. The Palace also contains a massive array of miscellaneous conference halls, salons, etc., used for a wide variety of other purposes.
In 2002, Costa Gavras shot scenes of Amen. in the Palace to represent the Vatican palaces.
In 2003-2004 a glass annex was built, alongside external elevators. This was done to facilitate access to the National Museum of Contemporary Art (MNAC) opened in 2004 inside the west wing of the Palace of the Parliament, and to the Museum and Park of Totalitarianism and Socialist Realism, also opened in 2004.
The cafeteria for use of the legislators has been refurbished recently, alongside the addition of a swimming pool, sauna and sports facilities at basement 1.
Also in the building is the headquarters of the Southeast European Cooperative Initiative (SECI), an organization focused on regional cooperation among governments against cross-border crime.
Parts of the building (some of the west wing, some of the east wing, parts of the second floor, basement 3 and everything below) are yet to be completed. Currently, a new underground parking lot is being built inside a former stadium, currently used as a warehouse, which was covered during the construction of the palace. Tunnels linking 13 Septembrie Avenue with the basement of the building will be built.
There are public tours organized in a number of languages.