The creator of this fort is unknown. In 1485 this place came under rule Nijamshahi dynasty. When Shahaji Raje became the secretary of Nijamshahi, Mughals of Delhi tried to end Nijamshahi. In 1635-36, Shahaji Raje transferred himself with Jijabai and Shivaji Maharaj to Mahuli. When Khan Jaman attacked the fort, Shahaji asked Portuguese for help, who refused and Shahaji surrendered.
Shivaji Maharaj took this fort from Mughals on 8 Jan 1658. In 1661 it was given back and was won again by Shivaji Maharaj. In treaty of Purandar, in 1665, Marathas lost these forts again. In Feb 1670, Shivaji Maharaj tried to conquer Mahuli, but failed, Manohardas Gaud, was the in charge of the fort. A thousand Marathas were killed. Manohardas Gaud, soon gave up his position and Alveerdi Beg took over. On 16 June 1670, after two months, Moropant Pingle conquered the forts and Mahuli, Bhandargad and Palasgad became part of Swarajya. Till 1817, Shivaji Maharaj’s dynasty owned the fort but later on it was controlled by the British Raj.