The Palyul Monastery was built by Lhachen Jampa Phuntsog, the first Dharma King of Dege. It was constructed on a site which possesses all the essential auspicious signs and had been blessed by the presence of many great mahasiddhas. In a prophecy from the treasure revealer Sang-ngag Lingpa, it is written of Palyul.
"The rocks clearly display self-originating images of Vajrapani as well as blue Hung syllables with radiating flames. Both the unsurpassed practice cave of Yeshe Tsogyal and the Secret Accomplishment cave of Padmasambhava are located there...At Namtsong rock [located in front of the Palyul monastery] thirteen secret termas have been concealed."
It was at this excellent place that the founding father, Kunzang Sherab, made his spiritual seat. Penor Rinpoche writes:
"The land the monastery is situated upon was blessed by the presence of many great bodhisattvas, dating back to the time of the three great dharma kings...In accordance with the ripening of past prayers, the Vidyadhara Kunzang Sherab later came to stay at the monastery. It was at this time that the Palyul tradition was established and the monastery named Palyul Namgyal Changchub Chöling became one of the major Nyingmapa monastic institutions."
In 1982 Penor Rinpoche returned to Palyul for the first time after leaving Tibet. He visited the main Palyul Monastery and many of its branch monasteries. Thousands came to received the blessings, empowerments and teachings which he bestowed. He ordained over 500 monks and made generous offerings to the members of the sangha. He also gave donations to support the reconstruction of the monastery.
Since his first visit, he has returned to Tibet several times, overseeing the reconstruction work as well as giving teachings, empowerments and transmissions. In 1994 he reestablished Palyul's monastic institute with over 140 students now enrolled in the study program there. Today there are over 300 monks in residence at the Palyul Monastery in Tibet. Link to partial list of Palyul branch monasteries in Tibet.