Shophouses in Palembang have been developed since the Dutch colonial era in a major trading area like 16 Ilir area. This paper discusses how shophouses as one of the important parts of the Palembang commercial area have various forms and transformations over time that contribute to shaping Palembang's urban environments. At first, Chinese merchants introduced shophouses that provide a space for both trading and living with some adaptation to local conditions. Later on, there have been some changes in both the exterior and the interior of those shophouses. The analysis of this paper focuses on the spatial arrangement of shophouses that resulted in the specific orientation, linear organization, and adaptation of a courtyard as a basic feature in a shophouse. This paper further analyzes the typology of shophouses in Palembang city and how some parts of those shophouses sustain and adapt to tropical climate in Palembang. The paper concludes that changes in a shophouse in Palembang are related to the idea of functionality, as well as sustaining the culture and needs.