It is placed right behind the Nasrullah mosque and built in 1746 by the Ottoman Foreign Minister the Hajji Mustafa Effendi. It was restored in 2001 by the Kastamonu Governorship to serve as tourist attraction place. The 21 stores in the Madrasa house many different traditional things from handcrafted items like hand-woven cloths and woodwork to the spices for the local cuisine and health foods.