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During the First World War, the hotel was used as a military hospital. The British military temporarily transformed the rooms for different medical purposes, even using the MacLeod Suite as a morgue for some time. There's also rumors that guests can hear the ghost of a small girl crying on the 4th floor of the hotel. Many speculate that this girl may once have resided at the Dunblane Hydro during its time as a boarding school for young women.

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