Nonsuch Palace was painted by the Flemish artist Joris Hoefnagel in 1568.
Culture Minister Ed Vaizey has placed a temporary export bar on the watercolour in the hope a UK buyer can match the asking price of £1m.
"We have very few paintings of the palace so I really hope we can find a buyer to keep this masterpiece here in Britain," he said.
The piece is the oldest of six remaining depictions of the palace, considered to be one of the Renaissance period's most stunning buildings.
Nonsuch Palace - named because no other palace could equal it - was built in 1538 for the Tudor king to celebrate the birth of his first legitimate son and mark his 30th year on the throne,
It was intended to rival the opulent residences of French king Francis I.
In 1670 Charles II gave the palace to his mistress, Barbara Villiers, who began to dismantle and sell parts of the building to pay off gambling debts.
By 1690 the building had all but disappeared.
The painting went for auction in 2010 but failed to meet its reserve price of £1.2m.
The decision to defer the export licence follows a recommendation by the Reviewing Committee on the Export of Works of Art and Objects of Cultural Interest (RCEWA), administered by Arts Council England.
They made their recommendation on the grounds of its close association with our history and national life, its outstanding aesthetic importance and its outstanding significance for understanding the nature of English Renaissance architecture.
The decision on the export licence application for the watercolour will be deferred until 31 May.

She said equality for women was "at the heart of the Scottish government".
More details about the competition, which is being run by the Young Scot organisation, will be released at a later date.
Ms Sturgeon has also called on women in leadership roles to follow her example and become mentors.
Speaking at a diversity event in Edinburgh, the first minister said: "My ambition for all our young people is that they will have a fair chance to succeed, and if they work hard and have the ability, there's nothing to stop them realising their dreams.
"It is not acceptable in 2017 for women to be under-represented in senior positions, including in the boardroom."
Ms Sturgeon insisted that her government offered "ambitious commitments" in support of women's equality which included;
She explained that one of her first moves as first minister was to appoint a gender-balanced cabinet.
The chief executive of the Young Scot charity, Louise Macdonald, said that supporting young people in realising their career potential and meeting their ambitions was the responsibility of every leader in Scotland.
She added: "Mentoring is a powerful way of helping young people achieve their goals and will help to create a new generation of positive role models to inspire other young women in the future.
"We're delighted to support the first minister and the Scottish government with this new mentoring programme and we are encouraging as many young women from across Scotland as possible to apply for this amazing opportunity."
"I hope that my election as first minister does indeed help to open the gate to greater opportunity for all women.
"I hope that it sends a strong, positive message to girls and young women, indeed to all women, across our land - there should be no limit to your ambition for what you can achieve.
"If you are good enough and if you work hard enough, the sky is the limit and no glass ceiling should ever stop you from achieving your dreams."
The earliest depiction of Henry VIII's "lost" palace in Surrey could leave the UK unless a buyer comes forward.
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Scotland's First Minister Nicola Sturgeon has launched a competition to find a woman aged between 18 and 23 to mentor for a year.