The estate was first mentioned in documentary sources as a "knauwe villa" in 1378 as the monastery courtyard of the Benedictine abbey in Saalfeld. The almost square residential tower in the center of the complex dates from this time. Excavation finds and dendrochronological investigations date this residential tower to around 1216 and the first structural alterations to 1399. At the end of the Middle Ages, the lords of Gräfendorf were appointed as secular administrators of the estate. With the dissolution of the church property after the Reformation, the estate was extended by the new owners - the von Brandenstein family - with a Renaissance castle in keeping with the times.

The first and second floors contain large banqueting halls that are exceptional in terms of their dimensions and furnishings. Together with the municipality of Knau, a support group is trying to find a new use for the historically significant estate complex. The association regularly organizes castle festivals, exhibitions, readings and concerts as well as themed guided tours.