The building is very impressive and holds a central place along the axis of the square that gathers all the commercial activities of the town. The building had been constructed to house the official and eminent guests of the Knights during their staying in Rhodes, as we are informed by the Italian traveler Niccole de Martoni, who visited the island in 1395; he also adds that it is «beautiful and splendid, with many nice rooms and good beds». During the siege of the town by the Ottomans in 1480 and the earthquake that followed in 1481, the building suffered extensive destruction. It was rebuilt, a process that lasted up to 1516, when Grand Master was Costanzo Operti, as it is evidenced by the walled-in blazons, preserved up to now.
During the World War II, in 1944, the eastern part of the Hospice collapsed by Allied bombing, along with many buildings in the center of the Jewish quarter. After the bombing, the building, semi-ruined, stood forlorn within an abandoned neighborhood. The preserved part was occupied by homeless immigrants from the nearby islands, who lived there in miserable conditions. This situation lasted until 1986, when the Hospice along with the 20 buildings, state-owned properties, entered in the restoration program of the Office of the Medieval Town, which had been founded in October 1985. The restoration of the building had, first of all, to face the problem of resettle the 16 families living in the hospice, a process that lasted until 1993. At the same time it was carried out the archaeological survey on the site, which also lasted until 1993. There were also undertaken urgent rescue measures alongside the restoration of the Hospitaller masonry and structural examination and consolidation works and architectural restoration of the medieval features, while the bombed part was rebuilt. Thus, the restored Hospice of Aghia Aikaterini became the center of restoration of the whole area. After the end of the restoration works it became a pole of attraction for many visitors both Greeks and from abroad.