Nara Dreamland closed in August 2006 due to declining attendance. The park's popularity waned significantly after the opening of Universal Studios Japan in nearby Osaka, which drew visitors away from Nara Dreamland.
After Nara Dreamland closed, some of the rides and attractions were left to decay, while others were dismantled and removed. By the time demolition began in 2016, many of the structures were severely damaged by weather and vandalism.