Mr. Krabs' main purpose of opening it was to get SpongeBob's penny. To enter, one needs to pay only one penny. The theater was popular, but not successful; however, since all Mr. Krabs had to offer the hopeful customers was a flip book made of dollar bills. After unsuccessfully trying to get SpongeBob's penny, Mr. Krabs destroyed it, although it reappears in Fiasco!. Mr. Krabs most likely sold the blueprints and/or the material to the city.
The outside of the Movie Palace has colorful floors and red doors leading to the inside. At both sides, movie posters are displayed on the wall. At the middle the theater has a green ticket booth. The inside is shown in "Fiasco!" and is has a big movie screen in the front, a section of seats on the left, an aisle, then another section of seats on the right. The walls are green and the seats are purple.
The Movie Palace's first appearance was in Penny Foolish, when Mr. Krabs built it to get SpongeBob's penny. Its latest appearance was in "Fiasco!" when the police chase Plankton into the theater. This is also the only time that the interior is shown.