The palace is made of red sandstone along with red coloured bricks and is situated in a striking environment that is on a small hill, commanding a view of the Tawi river valley. The palace was constructed in accordance with the European style of architecture, similar to a castle and therefore, includes slanting roofs with soaring towers. During the reigning period of Raja Amar Singh, the palace used to be amongst the tallest structures in Jammu.
It is believed that the construction of the Jammu city along with the Bahu Fort is associated with a legend. Raja Jambu Lochan who was Bahu Lochan's brother, encountered an interesting scene on one of his hunting trips that is of a goat and tiger drinking water together in the Tawi River. The scene caught the attention of Raja Jambu Lochan as the tiger did not display any aggressiveness to attack the goat.