After the annexation of Crimea to the Russian Empire, the owners of Massandra included French Rear Admiral Prince Karl Nassau-Siegen, landowner Matvey Nikitin, Sofia Konstantinovna Pototskaya, Olga Stanislavovna Naryshkina, Alexandra Vasilievna Branitskaya, and the Vorontsov family. In 1881, Prince Semyon Mikhailovich Vorontsov began construction of the palace based on a design by Etienne Bouchard in the style of Louis XIII. However, in 1882, after the prince's death, the work was halted.

In 1889, the estate was acquired by the Imperial Department for Emperor Alexander III. Architect P. K. Terebenev described the state of the palace at the time of purchase as a two-story stone building with a basement, built from local limestone, with a zinc roof and dormer windows. Inside, iron beams were installed, but other parts of the building were missing. The cost of construction was estimated at 85 thousand rubles. From 1892 to 1902, Maximilian Messmacher continued the construction, preserving the dimensions and style but transforming the building into a fairy-tale structure. The construction was overseen by architect Oscar Emilevich Wegener. The palace belonged to Alexander III, then to Nicholas II. The emperors often visited it but never stayed overnight.

In 1822, under Olga Naryshkina, the famous gardener Karl Kebah created an English-style park in Massandra, replacing the oak-hornbeam forest. Paths, alleys, and flower beds were laid out. Under Kebah's guidance, the park was planted with junipers, cedars, cypress trees, Mediterranean pines, and exotic fruit trees. It is now one of the best landscape parks, covering an area of 42 hectares.

From 1929 to 1941, the palace served as a sanatorium "Proletarian Health" for tuberculosis patients. In the post-war years, it was occupied by the Magarach Institute of Viticulture and Winemaking, but only for a short time. From 1948, it housed a state dacha known as "Stalin's," where Stalin, Khrushchev, and Brezhnev rested.

After Ukraine gained independence in 1992, a museum opened in the palace. In 1993, four Ukrainian-Russian agreements, known as the Massandra Agreements, were signed here.

The palace retains unique household items, such as a fireplace made from a solid piece of brown marble and handmade chandeliers. Built-in furniture made of mahogany and mirrors have also survived. Some elements of wall and vault decoration have not survived, but overall, the palace remains a cozy family residence, just as it was over 100 years ago.

After the annexation of Crimea to Russia in 2014, the palace came under the management of the Affairs of the President of the Russian Federation.

On June 1, 2017, a bronze bust of Emperor Alexander III, created by sculptor A. A. Apollonov, was unveiled on the grounds of the Massandra Palace.

In 2018 and 2019, the third season of the series "Catherine" was filmed on the palace grounds. The palace depicted the residence of the King of Naples, where Princess Tarakanova was hiding.