A number of hypotheses exist regarding the construction and exact dating of this monastery. The most accepted hypothesis demonstrates it as a late 8th century structure constructed by the second Pala king ‘Dharmapala’. A number of monasteries grew up during the Pāla period in ancient Bengal and Magadha. According to Tibetan sources, five great Mahaviharas stood out: Vikramashila, Nalanda, Somapura Mahavihara, Odantapurā, and Jaggadala . The five monasteries formed a network; "all of them were under state supervision" and their existed "a system of co-ordination among them”. It seems from the evidence that the different seats of Buddhist learning that functioned in eastern India under the Pāla were regarded together as forming a network, an interlinked group of institutions," and it was common for great scholars to move easily from position to position among them .
The excavation at Paharpur, and the finding of seals bearing the inscription Shri-Somapure-Shri-Dharmapaladeva-Mahavihariyarya-bhiksu-sangghasya, has identified the Somapura Mahavihara as built by the second Pala king Dharmapala (circa 781-821) of Pāla Dynasty. However, controversy also remains regarding the origin of the architecture of the monastery. The unfamiliar lay out of the monastery with the central cruciform structure is responsible for that. Dikhshi  has mentioned that it was originally a Jaina monastery, which was later converted into a Buddhist religious centre by Dharmapala. He argued on the basis of the following three findings.
- The first was based on the cruciform planning of the central structure. During the time of excavation (1928-35) and for a remarkable period of time after that, a cruciform Buddhist shrine or stupa -shrine was unusual anywhere else in India.
- He further argued on the basis of the chronicle of Xuanzang , who visited this region in the 7th century and describe some Buddhist and Deva  temples of that time. However, Xuanzang never mentioned Sompur Mahavihara in his description. According to Dikhshit it was quite impossible for Xuanzang to overlook a Buddhist monastery at Paharpur if it really existed, while it was so near to the capital city of Pundravardhana. It implies that there was no Buddhist establishment at the present location during Xuanzang’s visit. So if any structure did really exist there at that time, then the most likely possibility was that it was a Jaina Vihara.
- An earlier phase of the monastic establishments is discovered below the level discovered by Dikhsit. It suggests there was evidence of other structures on the site before the establishment of Sompur Mahavihara, Jaina believers probably occupied it.
There are also arguments against this hypothesis of conversion of a Jaina monastery into a Buddhist religious structure. The excavation in the central structure showed that from the foundation to the superstructure, it was built at one time and there were no major changes in the architectural plan by subsequent builders. It advocates that at least the central structure was conceived and realized at one time and it is also hard to accept that Buddhists had reused a Jaina structure as one of the most sacred and symbolic architecture while they had the support of one of the most powerful and great empire of that time. The most interesting fact is that although during the time of Dikshit’s excavation there was no example of cruciform Buddhist shrine or stupa shrine at any other nearby places, subsequent excavations in different places like Mainamati ( Shalban Vihara, Ananda Vihara, Rupban Mura and Bhoja Vihara), Antichak (Vikramshila Vihara) and Jessore (Bharat Bhayna Vihara) in Bengal exposed six other similar structures. Except from Bharat Bhayna (5th century) the others belong to the same period i.e. 7th- 10th century. It means that cruciform shrine type was quite familiar to the Buddhists in Bengal, even in the fifth century A.D. Further, a ‘Chaturmukha’ or ‘Chaumukha’ Jaina shrine was not common in Bengal. The nearest example found was in Ellora in Maharashtra and in terms of planning it has very little similarity with the central temple of Paharpur.
As Dikhsit and later archaeologists had confirmed that the square perimeter block, that exists today and the remains of the central structure belong to the same period and were constructed at the same time. So we can assume that whether there was any monastery or not (either Jaina or Buddhist) from the earlier period, it was the early Pala kings who were responsible for this grand monastic scheme that presently exists. It was the symbol of the devotion of Pala kings for Buddhism as well as a political statement of Pala hegemony and power over the region of Bengal.
However, Nalanda inscription of Vipulashrimitra records that the monastery was destroyed by fire, which also killed Vipulashrimitra's ancestor Karunashrimitra, during a conquest by the Vanga army in the 11th century, assumed to be an army of the Varman rulers. About a century later Vipulashrimitra renovated the vihara and added a temple of Tara. The restoration work was alluded to as jagatang netraika vishrama bhuh (a singular feast to the eyes of the world) .
 The reason behind such an argument is that Xuanzang has given a list of Deva and Buddhist temples that existed during his visit in this region. However, although he had mentioned the presence of quite a number of Jaina believers at that time but did not describe any of Jaina religious structure. That means he intentionally skipped the description of Jaina monasteries.