The final sanctuary built by the Guardians of the Orb. Though the tribe is gone, the shrine survives them.

The Palace of the Dragon, alternatively dubbed Palace of the Venerated Dragon, is a large dungeon situated on an island off the northeastern coast of Midgard. It is featured in Valkyrie Profile under its former name and Valkyrie Profile 2: Silmeria under its latter name. It is the final resting place of the Dragon Orb, which preserves the stability of Midgard.

In both its iterations, the Palace is formed of a "light" and "dark" series of rooms, connected by a complex teleportation system based on stones designating various phases of the sun ("light" rooms) and moon ("dark" rooms). It also contains guardian statues and difficult enemies.

In Valkyrie Profile 2: Silmeria, the Palace is connected to the Dragonscrypt.

After having been removed from the Serdberg Mountain Ruins some 500 years prior to the events of the game and having passed through Audoula Temple on the Lake, Surts Volcano Caverns and Crawsus Forest Ruins, the Dragon Orb was laid to rest in the depths of the Palace. In their bid to protect the Orb from the ambitions of both Dipan and the gods, Alicia, Silmeria and the rest of the team track the Orb down. However, as Alicia is about to claim the Orb, Hrist reveals herself by discarding her disguise as Leone. She takes the Orb, warning Silmeria not to attack, as she does not want to kill Alicia. However, Arngrim, angered at having been fooled, charges at her and is killed. She forcibly makes him an Einherjar, despite his protests and Silmeria's warning that the last Einherjar who rebelled against Odin became the king of the Undead. However, Hrist is undaunted and returns to Asgard with Arngrim's soul. Silmeria explains that she could not have fought Hrist on even terms, trapped as she is inside Alicia's body. Rufus takes exception to this, but Lezard defuses the situation by saying she did her best. He also says that the gods will now attack Dipan for its insubordination and suggests returning there. Dylan fears that it may be a trap to capture Silmeria, but since it is the only recourse they have, the party sets out for Dipan.