Karazhan is located in Deadwind Pass on the sub-continent of Azeroth in the Eastern Kingdoms. Existing long before Medivh inhabited it, it is unknown who originally built Karazhan or who now resides within its walls. The land it sits on "was similar in shape to a human skull. Many had noted it over the years, though only a few had been sufficiently brave, or powerful, or tactless to mention it to the property's owner."

Karazhan's history begins with an explosion that carved out Deadwind Pass and weakened the fabric of reality in the region. Someone then built the tower, probably to take advantage of this weakened reality and heightened magic. Medivh eventually took up residence there, but mused that the explosion and the construction only happened because he would eventually arrive.

During the First War, the tower was inhabited by Medivh, his steward Moroes, his cook named Cook, and his then-apprentice Khadgar. Garona also resided here as an emissary in the same time of Khadgar's apprenticeship. Sargeras allowed Medivh to freely explore Karazhan. As a result of the region's weakened reality, many strange and disturbing visions lurked within the tower, and Moroes was known for wearing blinders to avoid seeing them. The visions were ultimately ended when most of Karazhan's ambient magical power was absorbed by the resurrected Medivh, reducing it to "a pile of stone in the remote reaches", its power taken to serve the Prophet