After the appointment of the first Drung or Drungpa (sub-divisional administrator), it became a pressing need to have a large and fitting centre to address the affairs of the people. And perhaps more importantly, because of its location, being near to the border of Tibet, due to which there were possibilities of the Tibetans invading Bhutan and thereby threatening the integrity and sovereignty of the nation. Thus, in 1895 the people of Haed valley contributed in the construction of a well structured and a multipurpose building. The Dzong as any other in the country also had a Ta Dzong (watch tower) for the purpose of detecting any enemy approaches from afar. This Dzong was built in a place called Dumchog and it was also called Haed Dumchog Dzong. The attendants who served in the Dzong settled nearby the Dzong and the place where they lived came to be known as Dzong Zhip (literally meaning workers in the Dzong). In addition to its military and secular purposes, the Dzong also became a reservoir of grains, which could be distributed to the people should there be any kind of natural disaster in the region causing famine.

Another oral tradition has it that another reason why the Dzong was built in this place was to hold back the evil influences of the serpent deities upon the lives of the people and their livestock. This place, where the Dzong was built, was a place well known for the abundance of serpent deities. People say that there were about hundred and eight such serpent deities in and around that place. Even after all these years, some of the stupas which were built in order to appease these deities can still be found. Unfortunately, in 1913, during the tenure of Haa Drung Kazi Ugyen Dorjee, the Dzong caught fire and was left as a pile of ashes. The devastation was so huge that the Drung, who otherwise had the authority to summon people for the reconstruction decided it was easier to build a new one than to revamp the burned Dzong. Thus, Dumchog Dzong met with its end in a futile fire incident. It was finally abandoned and a new Dzong erected

Today all that is left of the Dzong are ruined walls worn out by weather and time, and some scattered boulders. Sadly a marvelous and significant artifact was once and for all lost to the power of nature.

In the same year that Dumchog Dzong was reduced to rubbles by fire, Gongzim Ugyen Dorjee took charge to build the new Dzong. The people of the four Geogs were summoned to contribute their labour tax during the entire renovation period. The new Dzong which was to assume the functions of the ruined Dumchog Dzong was built about a kilometer away from the debris of the Dzong. A prefix, Dzongsar meaning the new Dzong, was added to the new name of the Dzong. Hence, the Dzong was called Dzongsar Wangchuk Lo Dzong