The chapel building began life as the parish church of Lidhult, in the diocese of Växjö, constructed in 1721 from hewn timber. When Lidhult built a new church in 1879, the old timber structure was largely dismantled, and its fittings and materials were auctioned off, scattered as far as Denmark and the United States, with some timber even used to build a farmhouse.
In the mid-twentieth century, the Halland county antiquarian Erik Salvén worked to trace and reassemble the old church's components. The farmhouse built partly from the original timber was bought back and dismantled, and the church was re-erected on a headland at Tyludden overlooking the sea, reopening in 1950. The rectangular building, with its west porch, is clad in wooden shingles painted red on the walls and black on the roof.
One striking feature is the painted ceiling, created in 1738 by Johan Christian Zschotzscher for the original Lidhult church. Although roughly a third of the original boards were lost, the surviving panels were recovered, restored and supplemented in 1950, depicting scenes from the life of Christ alongside angels and decorative borders.
Several historic fittings have found their way into the chapel from elsewhere. The pulpit is on loan from Källsjö church, demolished in 1838, and incorporates some carved details from the old Lidhult pulpit. The font came from Gällared church, and the altarpiece was carved in 1747 by the sculptor Sven Segervall of Växjö. A medieval statue of Saint Olof, once in the old Lidhult church, is represented today by a copy, presented by the Danish state in gratitude for Sweden's hospitality towards Danish refugees during the Second World War.
The chapel's organ has its own well-travelled history: built in 1776 for Mossebo church in Västergötland, it was altered in the nineteenth century, later stored without its case at a Gothenburg museum, and finally installed here in 1950 with a new facade, since restored more than once.