The land for the garden was cleared in 1995 after demolishing Hussain Sagar Thermal Power Station. In 1999, a land of 2.0 hectares 5 acres from a 22 hectares 55 acres plot was utilised for erecting a memorial for N. T. Rama Rao, the former Chief Minister of unbifurcated Andhra Pradesh. It was inaugurated by N. Chandrababu Naidu. It was planned to further expand this area, which has since been referred to as NTR Gardens, by constructing a museum about N. T. Rama Rao. This memorial was a part of the Buddha Purnima Project that was being handled by Hyderabad Urban Development Authority HUDA for the beautification and development of the Hussain Sagar lake and its surroundings as a major tourist attraction.
In 2000, the Government of Andhra Pradesh expressed its plans to develop this area with several projects such the NTR Gardens itself, a rock garden and an IMAX theatre. A few days later, a government official firstly said that the rock garden will be taken up by Dubai-based NRIs at a cost of ₹270 million equivalent to ₹1.1 billion or US$13 million in 2023. Secondly the IMAX theatre project, which was said to cost ₹520 million equivalent to ₹2.1 billion or US$25 million in 2023 was allotted to a private firm. Both these projects were to be executed in the same 22-hectare 55-acre plot which housed the memorial.
Controversy
Blooming flowers at the gardens.
Upon the beginning of work at these gardens in January 2000, a petition by two non-profit organisations sought an immediate halt of construction activity at the gardens. They contended that regulations showed the area around the lake as a recreation zone which must be kept away from all constructions for commercial or residential purposes. Since they claimed that these proposed projects violated all these, they sought a public hearing and an environment impact assessment before allowing these projects to continue. Accordingly, the local apex court instructed the authorities to stop the construction until further orders.
A media report suggested that according to the 1980 HUDA Master Plan, the area where the NTR Gardens are located originally was a water body, but a gazetted notification in 1994 could allow such construction activities.



