The Old Bungalow was constructed in 1916 and served as the officer's mess hall for the British Army camp. During Baba's first stay at Meherabad in May of 1923, He and the mandali refurbished this building while staying in the Post Office. During the short summer stay of 1924, the white horse that Mehera gave to Baba was brought here. Baba named him Sufi and kept him on the northeast verandah of the building.

Through the years, the Old Bungalow was used for many purposes, but mainly as a residence for the mandali and a few of the masts. During the first long stay at Meherabad on March 21st, 1925, Baba opened the "Meher Charitable Hospital and Dispensary" in this building; it operated for 19 months. During that time, over 7000 outpatients and 500 inpatients were treated here. Part of the northeast verandah was enclosed to make an operating room where cataract surgeries were performed. A leper asylum was established on the grounds to the east.

From the beginning of 1927, the main halls were used as classrooms for the Hazrat Babajan High School. Baba spent many hours grinding grain in a room in the southwest corner of this building during the 1920s. Meetings and music programs would also take place in and around this building. Games such as tennis and volleyball were played on the ground just to the east. Baba referred to Padri, Pendu, Adi Sr., and Vishnu, as the "four pillars of Meherabad", after the four wooden posts that held up the rickety roof structure of the old building.

In May of 1934, Baba dictated the fascinating points on cosmology known as "The Divine Theme" while staying in the southeast room.

Since Baba dropped His body, most of the building has been used as a dharmshala. In 1982, the southern half of the building was demolished and rebuilt to provide extra space for pilgrim accommodations.