The mosque was founded in 1467–1468 by the Ottoman military commander Hamza Bey in honor of his daughter Hafsa Hatun. The monument was built as a small, square prayer hall (mesjid) with a dome. In the mid- to late 16th century, the building was significantly expanded with the addition of a minaret and a large colonnaded courtyard (atrium), taking the form of a large mosque to meet the needs of the growing population. It is the first mosque that was built and operated as such in Thessaloniki, after the city was occupied by the Ottomans (1430).
The Hamza Bey Mosque is the only one in the Balkans to feature an atrium, with the exception of the mosques in Adrianople and Constantinople, which were capitals of the empire and seats of the sultanate. It is the only mosque with a portico whose founder was not a sultan, as it was an unwritten privilege of the Ottoman sultans to have colonnaded courtyards in their mosques. The square, domed hall, 17 m high, is illuminated by eight arched windows and a circular skylight. Twenty-two marble columns with 15 capitals dating from the early Christian period (5th–6th centuries) support the colonnades surrounding the atrium. The building ceased to function as a mosque after the liberation of Thessaloniki (1912). The mosque has undergone many changes throughout its long history. Refugees found shelter within its walls, and traces of their lives remain, such as the conversion of the entrance to the loft of the prayer hall into a fireplace. Other areas were converted into shops, while the most significant alteration was the transformation of the courtyard into the “Alkazar” movie theater—initially open-air and later enclosed by the installation of a roof over the courtyard.
For decades, the monument’s current state of deterioration was due to a number of factors and was further aggravated by the 1978 earthquake. From 2007 onwards, various documentation, stabilization, restoration, and conservation works were undertaken to protect the monument. Ιn 2023, the restoration project of the Hamza Bey Mosque was included in the Recovery and Resilience Facility. As part of the restoration interventions, the Ephorate of Antiquities of the City of Thessaloniki undertook the supervision and documentation of the archaeological excavations. The restoration and conservation works were undertaken by the Directorate for the Restoration of Byzantine and Post-byzantine Monuments and the Directorate of Conservation of Ancient and Modern Monuments of the Ministry of Culture.
The monument now holds a new identity as a cultural space, under the auspices of the Ministry of Culture, MOMUS and the Ephorate of Antiquities City of Thessaloniki.