In 1567 Cosimo I donated the medieval buildings standing between via Ulisse Dini and via S. Frediano to provide quarters for the Knight-priests, an important and influential division of the Order of Knights of St. Stephen.
Giorgio Vasari was charged with designing the new construction and David Fortini with building it. Their aim was to combine the buildings into a single construction with an attractive well-balanced exterior, similar in appearance to the others on the square,.
The lay-out was modeled on a monastery: a two-tiered porch in the rear of the building led to dozens of independent quartieri (quarters), each occupying three floors, with a staircase. Work on the Canonica lasted over forty years, because most of the funds were taken up with building the Church.
The long façade closely resembles that of Palazzo della Carovana: three rows of windows define the space; the variety of surrounds masks the differences among the medieval buildings joined together to make the new one.
Between 1604 and 1607 the accommodation above the house known as palla a corda was built; the rooms were renovated between 1690 and 1692 and further alterations were made in mid 19th century.