The monastery is situated at the top of Shireet Ulaan Uul, in a hidden deep among pine forest in the mountainous Khangai Nuruu National Park. This scenic monastery, founded by Undur Gegeen Zanabazar in 1653,  has become a major pilgrimage centre for Mongolians. In 1648, the young Zanabazar, who was only 14 years old, determined that the location on the Shireet Ulaan Uul mountain, overlooking a hill at 2,600 meters above sea-level, was an auspicious location. The first building was built in wood in 1651 when the young Bogd Gegeen came back from his studies, and the whole was completed three years later. He worked and meditated here for 30 years. Undur Gegeen Zanabazar created many of his best artistic endeavours, including Soyombo script. Some of which can be found now in the Zanabazar Museum of Fine Arts in Ulaanbaatar.

  The monastery was destroyed in 1688 by Oirat Mongols, during their military campaign against Eastern Khalkha Mongols. Restored in 1773, the monastery suffered severe damage during the religious purges of the late 1937s, as Mongolia's communist regime sought to destroy the Buddhist religion in the country.

Religious activities at the monastery restarted in 1992, and restoration of the monastery's grounds was completed in 1997. Two original temples and two stupas from the 17th century still stand, along with additional temples built in the 18th century. Ceremonies were staged to re-consecrate the monastery and a new statue of Gombo Makhagal (Mahakala) was carved and placed there. The monastery was inscribed as a UNESCO World Cultural Heritage site, in 1996. Several monks now reside and practice at the monastery full-time.

The monastery is around 50km from Kharkhorin.