In the 18th century the monastery was severely damaged by lightning. However, it was the Great Lisbon Earthquake of 1755, occurring shortly afterwards, that took the heaviest toll on the monastery, reducing it to ruins. Nonetheless, the chapel (and its magnificent works of marble and alabaster attributed to Nicolau Chanterene) escaped without significant damage.
For many decades the ruins remained untouched, but they still astonished young prince Ferdinand. In 1838, as King consort Ferdinand II, he decided to acquire the old monastery, all of the surrounding lands, the nearby Castle of the Moors and a few other estates in the area. King Ferdinand then set out to transform the remains of the monastery into a palace that would serve as a summer residence for the Portuguese royal family. The commission for the Romantic style rebuilding was given to Lieutenant-General and mining engineer Baron Wilhelm Ludwig von Eschwege. Eschwege, a German amateur architect, was much traveled and likely had knowledge of several castles along the Rhine river. The construction took place between 1842-1854, although it was almost completed in 1847: King Ferdinand and Queen Maria II intervened decisively on matters of decoration and symbolism. Among others, the King suggested vault arches, Medieval and Islamic elements be included, and he also designed an exquisitely ornate window for the main façade (inspired by the chapter house window of the Convent of the Order of Christ in Tomar).
After the death of Ferdinand the palace passed into the possession of his second wife Elisa Hensler, Countess of Edla. The latter then sold the palace to King Luís, who wanted to retrieve it for the royal family, and thereafter the palace was frequently used by the family. In 1889 it was purchased by the Portuguese State, and after the Republican Revolution of 1910 it was classified as a national monument and transformed into a museum. The last queen of Portugal, Queen Amélia, spent her last night at the palace before leaving the country in exile.
The palace quickly drew visitors and became one of Portugal's most visited monuments. Over time the colors of the red and yellow façades faded, and for many years the palace was visually identified as being entirely gray. By the end of the 20th century the palace was repainted and the original colors restored, much to the dismay of many Portuguese who were not aware that the palace had once displayed such chromatic variety.
The Pena Palace has a profusion of styles much in accordance with the exotic taste of the Romanticism. The intentional mixture of eclectic styles includes the Neo-Gothic, Neo-Manueline, Islamic and Neo-Renaissance. References to other prominent Portuguese buildings such as the Belém Tower are also present.
Almost the entire palace stands on rock. Structurally, it can be divided in four sections:
From the remains of the Hieronymite convent was saved all that what was possible to save: the cloister, the dining room, the sacristy, and the Manueline-Renaissance chapel. All were embedded in a new section that featured a wide terrace and a clock tower. The Queen's Terrace is arguably the best spot for admiring the exquisite architecture of the palace. The terrace contains a sundial and a cannon that used to be fired every day at noon. The clock tower was finished in 1843.
The Pena Park is a vast forested area completely surrounding the Pena Palace, spreading for over 200 hectares of uneven terrain. The park was created at the same time as the palace by King Ferdinand II, who was assisted in the task by the Baron von Eschwege and the Baron von Kessler. The exotic taste of the Romanticism was applied to the park as it was to the palace. The king ordered trees from diverse, distant lands to be planted there. Those included North American Sequoia, Lawson's Cypress, Magnolia and Western Redcedar, Chinese Ginkgo, Japanese Cryptomeria, and a wide variety of ferns and tree ferns from Australia and New Zealand, concentrated in the Queen's Fern Garden (Feteira da Rainha). The park has a labyrinthic system of paths and narrow roads, connecting the palace to the many points of interest throughout the park, as well as to its two gated exits.