When Gelgel fell, and its remnants regrouped in Klungkung, secondary kingdoms arose throughout the island and engaged in ongoing power struggles. In the early 18th Century, a palace was established in Timbul, south of Ubud, by a descendant of the Gelgel line. His ambition to create a dream kingdom, based on the ideal of Majapahit Java was more of less fulfilled, as he drew to his court the finest musicians, dancers, carvers and artisans, and built a splendid palace filled with lavish garden. As the story goes, his cultural accomplishments were so great that upon witnessing them, people could not help but exclaim, "My heart's delight!" In Balinese, "sukahatine." The word evolved into "Sukawati," which is now the name of this visionary king's line of descendants, and the town where he built his palace.

Throughout the 18th Century, control of the areas around Ubud and Gianyar passed back and forth between the Sukawati Dynasty whose princes are called "Tjokordas" and the Gianyar Dynasty, with its "Anak Agungs" and "Dewas". Ultimately, the region became a patchwork of small dominions ruled by Princes from one faction or the other, or the scion of an intermarriage between them. This is still the case, and while Ubud's palaces house a core line of the Sukawati family, other palaces in the region belong to Gelgel Gianyar stock or a separate royal line from Blahbatuh.

During the 19th Century, Ubud became an important court under its Sukawati feudal lord, owing allegiance to Gianyar. In 1884 Gianyar was overthrown by Sukawati princes from the nearby town of Negara, and after ten years of conflict, a Sukawati from the palace in Ubud sided with Gianyar and cooled the conflict. Perhaps the experience of centuries of adept politicking between these two dynasties gave them both the ability to understand the value of diplomacy and compromise when the Dutch asserted their power in Bali.