Begumpet stands on land given by the sixth Nizam of Hyderabad to his daughter as her wedding present when she married a Paigah noble.
Nawab Abul Quasim Owaisi Mir Yousuf Ali Khan, Salar Jung III famously known as 'Salar Jung III' was the fourth in order of nobility after the three Paigah.
In the hierarchy of nobles of Hyderabad, the Paigah family ranked immediately next to the ruling family of Nizams.
The mosque was constructed by Paigah Nawab, Nawab Sir Iqbal Ud Daula in 1906, after his return from Spain, as he was very much inspired by the Cathedral–Mosque of Córdoba.
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Believed to be a copy of a similar mosque in Spain, it might have caught the attention of the Paigah noble, either during his eight month long tour of Europe or he may have stumbled on a photograph.
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This was just one of the several estates given the honorific title of Paigah (meaning pomp and high rank) for the first time by the second Nizam, Nawab Nizam Ali Khan to the Paigah family's founder, Nawab Abul Fateh Khan Taig Jung Bahadur.
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The Spanish Mosque formed part of the sprawling 340-acre wooded estate of the Paigah nobles studded with seven palaces, all built in European and Indo-European styles.
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The mosque was built by the Paigah noble, Sir Vikhar-ul-Umra Iqbal-ud-Dowla, in 1906.