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The meeting house is situated in Meeting House Lane (formerly Sandy Lane).
A meeting was settled in Penrith in 1697 and it met at first in a house two miles away in the village of Clifton, where Friends kept a school until about 1706.
Layne House, a farm house on Sandy Lane, together with a yard and land, was purchased by Friends in 1699 for £80, a sum which was not paid off until five year later. The building continued to be used as a dwelling-house as well as a meeting house for some time and was used virtually as it stood until money was spent in 1718 on internal alterations. At first the building contained both meeting house and a stables. It was lit and entered from the road side and had an outside stone staircase leading to the stable loft at the south end. In 1730 another loft was provided at the north end with an internal newel staircase. Seats were provided in 1738 'at considerable expense'.
The Circulating Yearly Meeting for the Northern Counties was appointed to meet in Penrith in 1757 and a proposal made to double the size of the meeting house for this and future occasions. This plan was not carried out and the 900 expected at yearly meeting met in a temporary shade or booth. The need for extra space remained after the yearly meeting ceased in 1798 and an extension was made in 1803 at a cost of £251. This produced the meeting house in its present form. A wing was added to the west wall to create a T-shaped meeting space and entrance lobby and the areas remaining at either side were separated from the central space by hinged shutters. The stable loft was re-built with a stepped floor and fixed benches and the old loft on the opposite side was similarly fitted out, and with new outside steps. A gallery on the east wall of the meeting space, with gate and other fittings dates from this period. Subsequently the outside steps were removed and some of the land around the meeting house, except for the burial ground and an area rented out for allotments, was sold for development. In 1992 an extension was built at the north end to create a room for the children's class and a kitchen. In its present form the building presents an unbroken wall to Meeting House Lane with access through doors on the west side via the burial ground and a car parking area.
In 1996 the meeting house was used for some weeks as a day-centre for a group of refugees from the conflict in Bosnia who were being housed in the Penrith area.
In 1999 an exhibition with a public lecture was held in the meeting house to mark the tercentenary of Friends in Penrith. The event, which included displays of maps, early documents and models depicting the history of the meeting as well as Quaker costumes, tapestry panels and literature, created considerable public interest.