La Moneda, originally a colonial mint (moneda means coin), was designed by Italian architect Joaquín Toesca. Construction began in 1784 and was opened in 1805, while still under construction. The production of coins in Chile took place at La Moneda from 1814 to 1929.
In June, 1845 during president Manuel Bulnes's administration, the palace became the seat of government and presidential residence. In 1930, a public square —named Plaza de la Constitución ("Constitution Square")— was built in front of the palace. After the presidency of Gabriel González Videla it ceased to serve as a presidential residence.
During the military coup d'etat, on September 11, 1973, the palace was partially destroyed by aerial bombing by the Chilean Air Force. President Salvador Allende allegedly killed himself in the palace as it was under assault by the armed forces. Reconstruction and restoration projects were completed on March 11, 1981, although some bullet marks have been preserved and can still be seen nowadays. An underground office complex (the so called "bunker") was built under the front square, during the 1973-1980 restorations to provide a safe escape for then General Augusto Pinochet and for succeeding Chilean presidents in case of an attack.
During President Ricardo Lagos's administration, the palace's inner courtyards were opened to the public during certain hours of the day. Lagos also re-opened Morandé 80 — a gate used by Chilean presidents to enter the palace since the early 20th century. It was eliminated during the restoration of the palace as not being in the original plans, but was restored because of the heavy symbolism attached to it as being the gate through which Chilean Presidents entered La Moneda skipping the main's gate guard protocol or, in other words, as ordinary citizens of the Republic. It was also the gate through which the body of President Allende was taken out after the 1973 coup.
In April 2006, a new square named Plaza de la Ciudadanía ("Citizenry Square") was opened behind its southern façade, replacing a parking lot. The square was originally planned to unite the palace with Bulnes square, forcing the Alameda avenue in between to go underground, but such plans were scrapped. Because the square is presently cut in two by the avenue, the southern part was named Plaza de La Cultura ("Square of Culture").