The presence of  “arras [tapestries] green and blue, showing a gaudy summer morn”  in the palace's first room signifies the inescapable role of art and  creative media in humans' perception of the world. Tennyson's  questioning of the life of the artist lies at the foundation of both  “The Palace of Art” and “The Lady of Shalott,” which were  published together in the collection 
Poems.  The inclusion of tapestries in “The Palace of Art” serves as a  bridge to “The Lady of Shalott” and an intentional overlapping of  content and themes between the two poems.
            
The  Lady of Shalott creates her art at a forced distance from the society  she depicts, and even then she can only participate in that world  indirectly by translating what she sees through the mirror onto her  loom:
            
               There she weaves by night and day 
                A magic web with colours  gay.
                She has heard a whisper say,
                A curse is on her if she  stay
                            To  look down to Camelot. 
                She knows not what the curse may be, 
                And  so she weaveth steadily, 
                And little other care hath  she,
                            The  Lady of Shalott. 
            
            The artist in “The  Palace of Art” chooses to sequester his soul in the palace as an  escape and freedom from the mess of society, but—like the Lady of  Shalott—she finds the removal and isolation unbearable and  counterproductive to the creation of meaningful art. 
          William Holman  Hunt's painting The Lady of Shalott shows the artist surrounded by finished tapestries on the walls  around her mirror as she stands in the midst of an unfinished work.  The scene emphasizes the artist's total immersion in her art as she  gazes down at the work underway, colored in gold and blues. The same  effect dominates “The Palace of Art” as the reader tours the  rooms, courts and mosaics that fill the structure with artistic  representations of the world past and present. The mention of “arras”  in the first room stands out in the poem, because tapestry is the  only medium mentioned in the sequence of rooms.
          The  explicit inclusion of tapestry as the medium of choice simultaneously  indicates an awareness of the medium's significance and makes clear  the connection in theme with “The Lady of Shalott.” Though the  self-contained, rhyming form of the quatrains that describe the rooms  creates the impression of segmented and isolated environments, the  reference to works of art within the palace and the implicit relation  to “The Lady of Shalott” undermines the isolation of the rooms'  environments. The fact that tapestries are needed to create the  impression of the rooms' worlds demonstrates an awareness of the  importance of art in understanding and recording reality as  it unfolds around us.
          The  cycle of observation, representation and reference in the production  of artwork presents the seemingly unresolvable tension between art  and reality in “The Palace of Art” and “The Lady of Shallot”;  art is necessary to humans' understanding of the world, but media and  artists introduce subjective distortions into artistic  representations of reality. Hunt's painting and the countless other  instances of the Lady of Shallot in other works of art illustrate  artists' reliance on past art and mythology to enfold complex meaning  in their creations. 
          The  Pre-Raphaelites strive to create a new set of styles and symbols to  provide that depth—and the pervasive presence of the Lady of Shallot  indicates an acute awareness of the problematic position of the  artist within society. The brotherhood's reaction against what they  perceive as failed schools of art does indeed spur a distinctive set  of styles and themes, but that set nevertheless relies on  pre-existing art and symbolism to enrich its significance.