The monastery was founded in 1681 by members of the Daurian spiritual mission as a dependency of the Selenginsk Trinity Monastery on the shores of Lake Baikal, near the site where the Mongols of the Tsisan Khan tribe treacherously killed the tsar's envoy, Erofei Zabolotsky, and his companions.

The first chapel of the monastery was dedicated to Saint Nicholas the Wonderworker. In 1700, a new church was consecrated in honor of the icon "The Sign" of the Most Holy Theotokos, and in 1718, a wooden Spaso-Transfiguration Church was built.

After the fire of 1769, which destroyed almost all the buildings of the monastery, the construction of a cathedral began, with a lower chapel in honor of the icon "The Sign" of the Most Holy Theotokos and an upper chapel in honor of the Transfiguration of the Lord. This ancient temple of Buryatia was completed in 1778.

In 1812, the existing church in honor of Saint Nicholas the Wonderworker was consecrated, and in 1820, the construction of a stone fence around the monastery was completed, and a church in honor of the Holy Apostle and Evangelist John the Theologian was laid.

The proximity of the monastery to the Prorva Bay with its seaport attracted many well-known state and public figures traveling from the Baikal region to Transbaikalia, China, and Mongolia until the mid-19th century. Russian diplomatic missions paid special attention to the monastery and its necropolis of slain envoys, receiving foreign envoys here.

Since 1862, the monastery housed the center of the Transbaikal spiritual mission and the episcopal see of the Selenginsk vicarage, which was moved to Chita in 1880.

In 1901, the monastery was transformed from a male to a female monastery.

After the 1917 revolution, the monastery was closed, and in the 1930s, all its buildings, except for two churches, were dismantled and removed.

In the late 1950s, the light floor and domes of the Spaso-Transfiguration Cathedral were destroyed. Until the registration of an Orthodox parish here in 1995, the monastery was used as a club, school, and hospital for mentally ill children.

On April 19, 2000, the Holy Synod of the Russian Orthodox Church decided to revive the Spaso-Transfiguration Embassy Male Monastery on Baikal.

On July 12, 2002, new bells rang in the monastery. On July 18, 2002, restoration and renovation work began on the main temple. In the summer of 2002, archaeological research revealed the burial sites of the slain envoys, the locations of chapels, the stone fence with holy gates and towers. The restoration of the entire monastery complex is planned.