Before it was a building site, Penyberth was a farm at Penrhos near Pwllheli that had served for generations as a way-station for pilgrims walking to Bardsey Island. Welsh literary tradition records its hospitality going back to the fifteenth century. The farmhouse was the home of a cousin of Robert Williams Parry, the great twentieth-century Welsh poet, and patrons of poets had lived there before him. To Welsh-speakers it was not just a piece of land, it was a small lodestone of literary memory. In 1935 the Air Ministry requisitioned it, demolished the farmhouse over local objections, and began constructing buildings for what would become RAF Penrhos.

The bombing school was a controversial proposal long before the fire. The Air Ministry had wanted sites in Northumberland and Dorset, but each had been withdrawn after local protests. The choice of the Llyn was made over the strenuous objections of half a million people who signed petitions, of the Archdruid of Wales, of the bishops of Bangor and St Asaph, of Caernarfon and Anglesey county councils, and of every local political body that could be persuaded to vote. Prime Minister Stanley Baldwin refused to receive the deputation that travelled to London to present these objections. Saunders Lewis, then a lecturer at University College Swansea and president of Plaid Cymru, summed up the protest by writing that the British government was intent upon turning one of the essential homes of Welsh culture, idiom, and literature into a place for promoting a barbaric method of warfare. The construction had begun, by uncomfortable coincidence, almost exactly four hundred years after the first of the Laws in Wales Acts of 1535, which brought Welsh law into the English administrative framework.

On 8 September 1936 Saunders Lewis, the Baptist minister and poet Lewis Valentine, and the novelist and former schoolmaster D. J. Williams set fire to materials inside several of the bombing school's wooden huts. They were committed to Gandhian principles of non-violent civil disobedience: the building was empty, no one was hurt, and they made no attempt to escape. They walked together to Pwllheli police station and presented themselves to the duty sergeant. The legend has it that they then spent the evening discussing Welsh poetry with him. The first trial at Caernarfon ended in a hung jury, with several jurors refusing to convict. The Crown then exercised its right to transfer the case to the Old Bailey in London. There the three were tried in English in front of an English jury, convicted, and sentenced to nine months in Wormwood Scrubs.

On the morning of the trial transfer, University College Swansea sacked Saunders Lewis from his lecturing post before any verdict had been reached. Welsh-speaking communities read the move as a punishment for principled protest. When the three men were released in 1937 fifteen thousand people gathered to greet them at a pavilion in Caernarfon, a crowd of a size that no Welsh political event had drawn for a generation. The historian Dafydd Glyn Jones wrote that the fire was the first time in five centuries that Wales struck back at England with a measure of violence, and that to the Welsh people, who had long ceased to believe that they had it in them, it was a profound shock. Plaid Cymru, which had been a small intellectual movement before 1936, grew into something more serious in the years afterwards. The fight for Welsh-medium education, for bilingual road signs, for S4C television, and eventually for the Welsh Senedd, all draw a line back through Penyberth.

RAF Penrhos was completed and operated as a bombing school through the Second World War. After the war it served briefly as a Polish refugee settlement, and remnants of that community still live nearby. From 2000 to 2014 the Penyberth site hosted the Wakestock contemporary music festival, drawing tens of thousands of young visitors each summer. A simple stone memorial stands now near where the farmhouse stood, marking what was lost and what was won. The Welsh phrase Tan yn Llyn, Fire in Llyn, is the title of folk songs, books, and academic studies, and the names of the three men, Saunders Lewis, Lewis Valentine, D. J. Williams, are taught in Welsh schools alongside the poets and princes of older centuries. The farmhouse cannot be rebuilt. The memory does not seem to need rebuilding.