The Castle was originally an L-shaped tower house. This is the central part, possibly dating from the 17th century. The difference in the masonry is still evident. In its present form, the Castle dates from the 1860s.
The origins of the castle are said to date back to the 12th century. Documentation, however, begins in the 15th. In 1422, Murdoch, Duke of Albany granted the Barony of Balhousie to John Eviot. The property remained in the Eviot family, with a brief interlude in which the Mercers, a well-known family in the Burgh of Perth, had possession of the property, until 1609, when the lands were sold by Colin Eviot to John Mathew, son of Robert Mathew, merchant of Perth . The property then passed to Andrew Grant and John Lamb.
On 27 September 1625 , King Charles I granted to Master Francis Hay, his heirs and assignees, the lands and barony of Balhousie. He was the son of Peter Hay of Rattray and was a writer to the Signet before 1617. He acquired several properties in Perthshire and Wigtownshire, including the barony of Dupplin in 1642. He was fined £2000 sterling under Cromwell's Act of Grace and Pardon in 1654. He was succeeded by his son George (died 1672), who in turn was succeeded by his son Thomas.
Thomas Hay of Balhousie was the Member of Parliament for Perthshire in the 1690s. He was created Viscount Dupplin, with remainder to heirs-male of his body on 31 December 1697 .
William, sixth Earl of Kinnoull, died unmarried in London on 10 May 1709 and Thomas succeeded to the title as seventh Earl. He was suspected of favouring the Jacobite side and was imprisoned in Edinburgh Castle . He died four years later. The succession of earls continued, George Henry, eighth Earl, Member of Parliament for Fowey, Cornwall, Thomas, ninth Earl, Member of Parliament for Cambridge, Robert Auriol Hay Drummond, who succeeded his uncle as tenth Earl. He was appointed Lord Lyon King of Arms, which was then a sinecure. His son, Thomas Robert, succeeded as eleventh Earl. He was Colonel of the Royal Perthshire Militia, 1809-55, Lord Lieutenant of the County and succeeded his father as Lord Lyon King of Arms. It was he who extended the Castle.
The Hays did not live at Balhousie Castle , their main residence was at Dupplin. By the early 1860s the castle was in a dilapidated state. Only the first floor was inhabited. Thomas Robert restored the Castle and added two wings to the original L-shaped tower house. The architect he employed was David Smart. The building was then let out. The tenants included, Henry Hay Norie, a lawyer, John Shields of Wallace Works, who died in 1889 and James Ramsay, a jute broker.
The Hay family came to live at the Castle 1912 and remained until 1926. The Castle then became a convent. The nuns were from the Society of St Peter and were associated with St Ninian's Episcopal Cathedral. They appear to have remained until 1940.
During the Second World War, the property was used by the Auxiliary Training Service. The Castle was the Officers Quarters. After the War, it housed a detachment of the Royal Army Service Corps and the Headquarters, Highland District, Corps of Royal Engineers.
In the early 1960s there was a major Army re-organisation. The Black Watch Depot at Queen's Barracks was closed. Regimental Headquarters and the Museum came to the Castle.
