Deokjusa Temple is a branch temple of Beopjusa Temple, the head temple of the 5th district of the Jogye Order. The temple is believed to have been established in 597 AD by Princess Deokju, the last princess of the Silla Kingdom. According to legend, Princess Deokju stayed at the site with Prince Ma-ui and built the temple, naming it after herself, along with the cave nearby. However, there are no records to confirm or refute these claims.

The temple once stood in front of the Rock-carved Standing Buddha of Deokjusa Temple (a Treasure), but was burned down during the Korean War. The present temple building stands about 1.7 kilometers from the original temple site and is the result of reconstruction efforts conducted in the 1970s.