Enchanted Palace

This is what you probably know about Kensington Palace: Princess Diana lived here before she died in August 1997. But did you also know that Mary II died of smallpox here in 1694? Queen Victoria was born here in 1819 and was introduced to her beloved Albert here in 1836. Over a century on and Princess Margaret and her husband Lord Snowdon embraced the Swinging '60s here, inviting guests like Peter Sellers and Brit Ekland to their wild parties at the palace's legendary Apartment 1a.

Kensington Palace was a place of glamour, tragedy and love, played out by its seven most famous princess inhabitants: Mary, Anne, Caroline, Charlotte, Victoria, Margaret and Diana. Now you can immerse yourself in their lives thanks to a bold new exhibition merging fashion, art and theatre. Dr Joanna Marschner, senior curator of Historic Royal Palaces has turned the palace's £12 million refurbishment, due for completion in 2012, into a creative opportunity and the results are dazzling. 'It gave us a wonderful chance to do something quite different in this slot and have a bit of an adventure,' she says.

At first the exhibition seems a little confusing - dark and hard to navigate. But you soon realise this is all part of the thrill. You are ushered up a back stairwell adorned with doodles, to a soundtrack of whispering voices. Take on the quest of finding the hidden names of each princess if you want: it's not essential, but a brilliant way to keep children occupied.

The first room you enter is the deeply melancholic 'Room of Sorrows' inspired by Mary II, who lived at the palace from 1689 to 1694. Design duo Maki Aminaka and Markus Wilmont have created an exquisite 'dress of tears' which hangs above Mary's bed, symbolising the sad fact that she produced no heir and that of her sister Anne's 14 pregnancies, none survived.

Fashion plays a vital role in conveying the stories of the palace. Early in the planning stages Marschner approached a handful of key fashion designers: 'They needed to create pieces that could stand out on the stages that we could provide,' she explains. Each of them has risen to the challenge with stylish abandon. Vivienne Westwood has created a 'rebellious dress' for George IV's spirited daughter Princess Charlotte (1796-1817). Her beautiful crinoline dress is positioned dramatically on the king's chequered stone staircase.

In the 'Privy Chamber', milliner Stephen Jones has produced a dream-like installation of hats inspired by the palace's busts of Sir Isaac Newton and his laws of motion. Jones is familiar with the palace - he used to fit the late Princess Diana with hats when she lived here in the 1990s.

Brian Kirkby and Zowie Broach of British couture label Boudicca took inspiration from the vast clock in the 'Room of Palace Time'. Their incredible sculptural creations made from brass, iron and wood are directly inspired by the workings of the clock and they hang magnificently from four golden chandeliers. 'We were able to explore different ways of examining dress,' says Broach. 'It cascaded into a really incredible journey.'

Crucially, Marschner also enlisted Wildworks, the Cornwall-based theatre group known for producing events in unusual places, from derelict mines to abandoned department stores. Bill Mitchell, their artistic director, has used the hidden stories and personal lives of the palace's former inhabitants as inspiration and the results are spectacular. With overall design control of the exhibition, Mitchell has provided 'detectors', a group of actors dressed in strange grey monk-like uniforms who walk around the rooms interacting with visitors - singing, chanting and telling stories.

You soon learn that there is no set path around this exhibition - it's best to wander haphazardly at your own pace while gleaning wonderful nuggets of information from the knowledgeable palace staff, who have been actively encouraged by Wildworks to interact with visitors. 'The idea is that everyone from the palace's own guards and dress conservators to the actors playing the “detectors” enrich the experience, themselves part of this evolving experience,' explains Marschner.

It's in Queen Victoria's old bedroom that the emotional history of the palace really hits you. As a child, Princess Victoria had not a moment of privacy - her mother read her journal every night. Hot new London designer William Tempest has created 'a dress for dreaming of freedom' made from thousands of origami birds which look as if they are about to fly away, to represent Victoria's desire to escape. It's incredibly moving.

No doubt one of the big draws of the exhibition will be the 'Room of Dancing Princesses', designed in the style of a mythical forest. This is where you'll find the Norman Hartnell gown which belonged to Princess Margaret and a dazzling Bruce Oldfield sequinned dress worn by Princess Diana. These are just a taster of the palace's own splendid Royal Ceremonial Dress Collection, which includes 12,000 items - from baby shoes to wedding gowns.

By the end of this complex journey, you can't help but feel emotional. In the final room, 'The Gallery of Shadows', black-and-white images of each princess flicker up on mirrored screens and every few seconds you catch your own reflection. As you walk past them to the music of Henry Purcell, don't be surprised if a lump rises in your throat. And you don't get that walking around Buckingham Palace.