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Palace

Every so often, you'll get a pop-up that says something to the effect that: Your people are so pleased they want to expand your palace. At that point, you'll be take to the palace screen. Move your cursor around and you'll see the various possible improvements that you can make, Pick one and click. Unfortunately, I don't know what the triggering events for palace expansion are.
 
Building your second city does it, or seems to for me. Defeating barbarians attacking a new city has as well. Other than that I dont know for sure.
 
I sometimes get the palace expansion screen after a military victory or when a lot of city improvements are constructed in one turn. I also seem to get to expand my palace when many cities are celebrating WLTKD. There are screenshots on these forums that show the palace expansion box pop up during mass rioting and I once got to expand my palace after a barbarian pillaged one of my cities so it could just be random.
 
I used to get those palace improvement pop-ups but not anymore since I play custom maps! :(
but I think that Palace thingie is completely useless/without a purpose
 
True, the palace is only fluff, but thats true for wonder screens/movies too!

And the purpose of the entire game is nothing more than entertainment.

To the OP:
The first palace improvement pops up after pillaging your first barb camp.

There are more of these rules, but I don't know most of them. I think most of the time its a first time you succeed at X rule. Just like the barb camp one I mentioned above.

Building your 2th city as Nergal stated, has no effect as far as I know. I usually expand very quickly, and have many cities before I bust my first barb camp most of the time.
 
I've definitely had it from building a 2nd city .. some games I dont get any palace expansion until quite late into the game. Does it depend on level?
 
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