Early in the 1550s, King Gustav Vasa ordered the building of a Palace on a small island in the fast-flowing Kolbäck River. Much of that Palace was demolished at the end of the 1660s. Strömsholm at that time was part of the appanage of the Queen Dowager, Hedvig Eleonora, and it was on her orders that the old Palace was pulled down and a new Palace began to be built. Here as at Drottningholm, the Queen Dowager collaborated with the architect Nikodemus Tessin the Elder.

Strömsholm Palace consists of a massive central building framed by four square towers. A dominant central tower with a large, dome-like cap, rises on the park side. To this there were added in Hedvig Eleonora's day about 20 buildings within the Palace perimeter for servants, supplies etc., and work began on laying out the grounds in French Baroque style.

The Palace was mainly completed as Tessin had intended, but work on the interiors came to a standstill. The architect Carl Hårleman completed the chapel in 1741. The chapel organ, built by the organ builder Daniel Stråhle in 1743, has been preserved in its original state. In 1766 the heir to the Swedish throne, Gustav - the future Gustav III - married Princess Sofia Magdalena of Denmark and the Riksdag (parliament) presented her with Strömsholm as a wedding present. Extensive work on the interiors began the following year, under the direction of the architect Carl Fredrik Adelcrantz. Today the Princess's bedchamber is an outstanding example of Swedish interior design at the beginning of the neo-classical epoch. Another very interesting feature is the Chinese dining room, the fabric-covered walls of which are decorated with Chinese-style paintings by the well-known tapestry painter Lars Bolander. Strömsholm was never a permanent royal residence. Instead it became a sort of pied-à-terre. It was ideal for overnight stays on journeys to the south of Sweden.

Mainly people associate Strömsholm with horses. There was already a stud farm here in Gustav Vasa's day. This was a very important concern in the Caroline period, and between 1868 and 1968 Strömsholm was the home of the Swedish Army Riding School. The old officers' mess from that period has recently been reinstated. Today Strömsholm is once again a hippological centre, including a specialised high school for promising young riders.