The cloister was founded in 1192 by the monastery's first hegumen, the former Novgorodian boyar Oleksa Mikhailovich, whose monastic name was Varlaam. The main church of the monastery was consecrated by Archbishop Gavril of Novgorod the following year, the same year Varlaam died. He is buried in the main church of the monastery, the Church of the Transfiguration, to the right of the altar. He was the patron saint of Novgorod and the patrilineal ancestor of many families of Russian nobility, including Chelyadnins and Pushkins, of which Alexander Pushkin was a member.