The founder of Karabakh khanate Panahali khan decided to build a firm fortress at a favorable place in order to be protected from the danger expected from the Iranian side. This fortress had to be the central fortress of the khanate as well. For this purpose, he selected an area with a spring at the bottoms of the monutains at a 10 kilometres distance of Agdam. The building of the Shahbulag fortress here was favorable in all aspects. That is, it was not dangerous. As to the historians, this fortress that would be the centre of the khanatr, has been completed in 1751-1752. Dwelling houses, a bath-house, a Mosque and a market have been built inside of the Shahbulag fortress. The Shahbulag fortress has been surrounded with high walls. The khan’s residence was situated in an eight-towered castle. The fortress has been rectangular, and has been built from unhewn stones. Most of the buildings inside of the fortress have been destructed. The building has had a great appearance. Panahali khan has lived here together with his family, relatives, kins, great masters and scholars. The reconstruction works have been held in the fortress and it has returned to its previous appearance (outside walls).