In the 17th-19th centuries, Shuya was a significant Old Believer center, maintaining strong trade and familial ties with the communities of Kostroma, Nizhny Novgorod, and Moscow. Many representatives of the local business elite had Old Believer roots. Until the early 20th century, services were held in home prayer houses with the participation of fugitive priests. In the 19th century, some Old Believers converted to the True Orthodox faith, leading to the establishment of such parishes in Ivanovo, Shuya, and Dunilovo. The earliest of these, the Assumption Church, emerged in the early 19th century in the village of Dunilovo.

From the late 19th century until the 1930s, Shuya had the All Saints' True Orthodox Women's Monastery with a large Assumption Cathedral in pseudo-Russian style. The monastery ensemble, with two churches, a fence, a refectory, and cells, played an important role in the city panorama, serving as the entrance gates to the historical center. In 1906, after the legalization of Old Belief in Shuya, the first Old Believer church was built. It was located in the Old Believer cemetery in the northeastern part of the city, near a birch grove that was a traditional place of rest. The history of the grove is linked to the Shuya-Troitsky Monastery, which was granted the territory by the tsars in the 16th century. In the 1870s, a public city garden was organized here, now known as the Culture and Recreation Park.

The stone church in Russian style was built with funds from merchant Yakov Turlapov and became one of the first Old Believer churches in Vladimir province. The church, made of brick and unplastered, is a rare example of an Old Believer church in eclectic style with elements of neo-Russian. Its decoration features forms stylized after Novgorod-Pskov architecture. The decor is concise and flat, but the curvilinear forms are executed elegantly. The side facades are highlighted by pilasters, while the central part is adorned with a wavy gable. The western entrance is notable for its massive semicircular portal and semicircular porch. Only the flat vault of the first tier remains from the bell tower.

After the church was closed in the 1930s, the building was reconstructed, some windows were bricked up, and in 1952, the park area was expanded at the expense of the destroyed cemetery. Now, the site of the cemetery features a dance floor and attractions. The iconostasis was transferred to the Ivanovo Assumption Church. The main volume of the church has been preserved, but the dome and bell tower were demolished. In the 1990s, the last fragment of the fence was destroyed. Inside the building, there was a woodworking shop, and now it houses the administration of the Culture and Recreation Park.