A palace built and inhabited by fairies; a palace in a fairy tale; (also) a building likened to such a palace, especially in the extravagance of its architecture or decoration.
Origin
Early 18th century.
Definition of fairy palace in US English:
fairy palace
noun
A palace built and inhabited by fairies; a palace in a fairy tale; (also) a building likened to such a palace, especially in the extravagance of its architecture or decoration.