This construction would have to have a square in front that would guarantee the grandiose building its vital space. Between the end of the 19th century and the beginning of the 20th century, the Municipal Council began to populate the large square in front of the Palace with trees.

The Terreiro de D. João V, its official name since 1955, underwent several changes over time, from its demarcation during the construction of the Royal Building, at the start of the 18th century, until the middle of the 20th century. The intervention planned by Paulino Montez in the 1930s Came best encapsulated the historical function of the square, a prime space for observing the monument.

Finally becoming a space of an urban nature, the square took on several functions in addition to the ones that were intrinsic to the period of King João V: it became a meeting place for tourist and cultural visits; and given its relationship to the Royal Palace, a space for economic transactions with the organisation of fairs; a space for walks, a stage for commemorations, etc.