The building was constructed in the early 1840s and opened on 11th August 1846. The cost of building amounted to £1,738 14s 91/2d. The chapel replaced Marsh Chapel located in the Ham area of Sidmouth which had opened in 1810. The building was used by the Sidmouth Congregational Church which later became the United Reformed Church. Over many years the church flourished and number of attendees increased, however, by 2017 the congregation had declined to around 20 members. A decision was made by the church to sell the property. The property was purchased by Ian and Rebecca Gregory in September 2017 for the purposes of establishing a toy and model museum while retaining aspects of the church heritage. The property was subsequently transferred into a charitable trust.
While renovating the property a number of features were retained including the church organ. The organ originally was installed in 1881 having been at All Saints Church Sidmouth since 1855. An electrically driven organ blower was installed in 1945 and the organ continues to work and is played from time to time. Also, the wall plaques commemorating past lives of individuals associated with the church were retained. These plaques provide a interesting insight to those associated with the chapel in the early and mid 1800s.
One of the plaques is for Anna Maria James who was one of the key supporters in the development and construction of Marsh Chapel and then of the current building. Other plaques of individuals associated with the chapel include the Reverend David Parker (1787 - 1832), Mrs Emma Stocker Robins (1798 - 1822), Amelia Hoggart (1787 - 1813) and William Robins (1747 - 1821).
There are also plaques commemorating those from the church who gave their lives in the First World War (1914 - 1918).
A booklet "The Story behind the Plaques" is available from the Museum.
The renovation of the building took over two years to complete. This included the replacement of the chapel roof, replastering in the chapel and foyer, complete redecoration and installation of the units for the museum displays.
Work complete and museum opened in August 2020.