The first documentary mention as "Falconolai" can be traced back to 891. The castle was first mentioned in 1135 by the owner Sigebold von Falkenstein. In 1233 the castle was owned by Philip III. from Bolanden, who first called himself "Herr zu Falkenstein". He was chamberlain and bailiff on the Trifels and inherited the bailiff in the Wetterau in 1258.
In 1456, Wirich IV von Daun-Oberstein acquired the castle and rulership. The latter founded and operated the mines and smelting plants. In 1536, his grandson Wirich V. von Daun-Falkenstein reinforced the castle with weir systems and had them converted into a Renaissance castle.
During the Thirty Years' War in 1647 the French sieged, bombarded and stormed the castle. General Schönbeck then blew them up with three mines. In 1654, subjects of the Falkensteiner stormed the building and shot the Lorraine commander Weingart. The last count of Falkenstein, Wilhelm Wirich von Daun-Falkenstein, sold the impoverished county to Duke Charles IV of Lorraine in 1667. Sixty years later, in 1736, the county came to the House of Austria-Lorraine through the marriage of Franz Stephan von Lothringen with Maria Theresia. Since 1782 it was administered as the Oberamt Winnweiler by the Austrian government in Freiburg im Breisgau.
In 1816, as a result of the agreements reached at the Vienna Congress, the Palatinate and thus also the castle were transferred to Bavaria. The Gienanth family acquired the castle area, which later fell to the Rockenhausen district and the Donnersberg district via the North Palatinate History Association. The castle ruins have been owned by the municipality since 1996.
The castle ruins were renovated in 1978 and 1984, and it was listed. After the Burgförderverein was founded, an open-air theater was opened in 1992 and a Kneipp facility in 1997. In 2007 the Falkenstein castle hut was rebuilt.