Torchwood House was a stately home owned by the MacLeish Family since the 16th century, as part of the MacLeish Estate. It was located in rural Aberdeenshire. (TV: Children of Earth: Day Two, Tooth and Claw)
Part of the house was turned into an observatory by Sir George MacLeish under the auspices of Victoria's husband, Prince Consort Albert of Saxe Coburg. Prince Albert and George created the light chamber, a device that, used in conjunction with the Koh-i-Noor, killed a Lupine Wavelength Haemovariform who tried to infect the Queen in 1879. The house suffered major damage during the attack. Several doors were broken down, a table crushed and the glass dome of the library shattered. All of the male staff, including the steward, were killed by the creature. Sir Robert MacLeish, the house owner and Captain Reynolds, Victoria's protector, were also killed.
As a direct result of these events, Victoria created the Torchwood Institute. On banishing the Doctor and Rose from the British Isles (concurrently with knighting them both), she warned that they should beware of Torchwood should they ever attempt to return. (TV: Tooth and Claw)
Behind the scenes
According to the Torchwood House website, which tied into series 2 of Doctor Who, Torchwood House was licensed for weddings and civil partnership ceremonies. One of the images one the website showed what appeared to be Bernard Cribbins, over a year before Cribbins appeared as the character of Wilfred Mott in the 2007 episode Voyage of the Damned. 
On another tie-in website to series 2, whoisdoctorwho.co.uk, Mickey Smith reveals that the Torchwood House website has an "online observatory" connected to "a bunch of satellites" that observe alien activity. Mickey has been using this observatory for looking out for "alien invaders and stuff", but notices that Torchwood have lost contact with the satellites. He asks the viewer to go onto the Torchwood House website, click on Observatory, and then "Scan for heavenly bodies" and to enter the password "Victoria".  This leads to an online game where the objective is to rediscover these satellites.