Maharana Bhagwat Singh of Udaipur started the restoration and reconstruction of the Lake Palace in the year 1959. The Maharana realized that the magnificent Lake Palace, with it's romantic setting had tremendous potential to attract tourists to Udaipur. While renovaiting the palace, priority was given to restoring the exquisite glass inlay panels. The only way to get to the Lake Palace Hotel is via launch. Crossing the serene waters of Lake Pichola brings you face-to-face with a 500 year old legend.

The half-submerged statue of a woman tells of a courtesan who claimed that she could dance across the waters of Lake Pichola balanced on a thin rope.  The Maharana wagered half his kingdom on this, and as she was about to complete the feat, the minister cut the rope for fear of losing the kingdom. The dancer plunged to her death, and the lake is revered for this reason.

The Maharana took the crucial but necessary decision to hand over the management of the Lake Palace to the Taj Group of Hotels. Today, this internationally renowned hotel continues to attract tourist from all over the world.