This palace is located between the Hafsia neighbourhood and the Pasha Street. Minister Khereddine had it built and moved to live there around 1279 H/1862 when he married Princess Jnaina, daughter of Minister Mustapha Khaznadar. In 1298 H/1880 AD he sold it to a French company who ceded half of it to the Israelite Alliance. The other half reverted to the Tunisian government and became, at the beginning of the Protectorate in 1299 H/1881 AD, the seat of the Tribunal until a courthouse was built on Boulevard Bab Benet. The Khereddine palace then became a primary school that kept the name of the original owner. Well after independence it was used by the theatre company "Troupe d'Art Dramatique" directed by the late Mohamed al Habib. It then became a municipal kindergarten. Currently, the building is being the City Museum.