The story starts in 1806, when George Steuart acquired the land that would become the Villa Marina Estate. After his death the estate passed to his son, Colonel Robert Steuart, who served as Receiver General of the Isle of Man and Customs Collector for the Port of Douglas. The estate was about seven acres of prime seafront. It included the Mansion House with its drawing room, dining room, two libraries, and fifteen bedrooms, plus walled gardens, lawns, plantations, a flower garden, and a hothouse containing tropical plants. The outbuildings ran to a four-stall stable, a coach house big enough for three carriages, a harness room, a granary, a farm stable and a piggery. It was, in short, a country house transplanted to a seaside town.

After the Steuarts the estate had a more eventful career than most country houses. It was bought by the uncle of the Misses Dutton - Frances and Eliza - who converted it into a seminary boarding school, moving their pupils across from Athol Street at the start of 1834. Joseph Dunn, that uncle, died in 1845; some of the western land was sold to John Crellin and became Derby Square and Crellin's Hill. The school carried on until Spring 1854, when the estate was put on the market again. A seven-year lease was arranged in 1861, and the Misses Dutton moved their school out to Parkfield Villa on what is now the A2 Glencrutchery Road. Governor Pigott took up residence in May 1861, but his tenancy was short - he died on 21 January 1863. On 4 May 1863 Henry Bloom Noble and John Firth bought the remaining lease for £7,750. William Johnson, a local publican, briefly turned the place into a hotel.

Johnson gave up the hotel lease in May 1868 and retired from business. Henry Noble bought out his partner John Firth and made the Villa Marina his personal residence. Some on the island grumbled; there had been a proposal to raise £10,000 in £1 shares so the public could buy the estate for a pleasure ground. Noble kept it private until his death in 1903. After he died, the building briefly housed Lord Raglan, the island's Lieutenant Governor. Then the bequest of Noble's will took effect. The Henry Bloom Noble Trust gave the whole estate to Douglas Corporation, which had it redeveloped as an entertainment venue. The design was chosen by open competition judged by Professor Stanley Adshead, an eminent designer of British seaside entertainment buildings whose other work included the Royal Victoria Pavilion in Ramsgate, the Worthing Lido, and the Pavilion Theatre and Worthing Pier. The winning architect was W. Alban Jones of Leeds. Lord Raglan reopened the same site in its new identity on 19 July 1913.

Its original name was the Villa Marina Kursaal - a German loan-word for a seaside entertainment hall that dropped out of use after the First World War. The grounds had been a favoured vantage point for the Gordon Bennett Trials, the early motor races first held on the Isle of Man in 1904, and the venue continued to draw large summer audiences for decades. Ivy Benson, the bandleader, performed here in the post-war years, alongside international cabaret artists; beauty pageants filled the gardens through summer. By the year 2000, however, the building badly needed renovation, and Douglas Corporation could not afford it - the same problem that had nearly killed the nearby Gaiety Theatre thirty years earlier. Ownership was transferred to the Isle of Man Government in March 2000. Today the integrated Villa-Gaiety complex includes the Royal Hall, the Broadway Cinema, the Promenade Suite, the Colonnade Suite, Dragon's Castle, and the Villa Marina Gardens. It hosts music concerts, comedy shows, chess and darts tournaments, boxing matches, and on occasion International All-Star Professional Wrestling - which is not, perhaps, what Professor Adshead had in mind, but is faithful to the spirit of a building designed for the people who came to a seaside town to be amused.