The Tower Heart is a large glowing magical orb possessing great power. It originally powered Castle Gromgard and then the Dark Tower. The heart collects magical energy and grows in power with its Overlord, it gave information on the minions and the overlord, as well on the world, and it had the ability to be used as a remote communicator with the Overlord, due its bond with him.
Overlord: Dark Legend
When Lord Gromgard turned sixteen, he received a magical gauntlet kept in storage for him until his birthday. After his brother and sister left Castle Gromgard, he used the gauntlet to open a sealed door to the castle's throne room. In the room he found the Overlord armour, left there by his uncle, the previous Overlord. After obtaining the armour and awakening Gnarl, Lord Gromgard discovered the Castle Heart (later Tower Heart). From then on he used the Castle Heart to travel the lands. After Seven Heroes defeated the Second Overlord, the Dark Tower was looted and the Tower Heart lost.
When the 8th hero became the Third Overlord, he went to the last known location of the heart, Mellow Hills. From there he searched for the heart and found it in the middle of a group of pumpkins — the halflings had been using the heart to grow them. The heart was taken back to the tower to power it.
When the Second Overlord returned to the tower in the body of the Wizard, the Tower Heart was damaged by the Third Overlord's mistress, causing it to glow red. After the Third Overlord defeated the possessed Wizard, the Tower Heart returned to normal. It became more powerful, and the rocks around the tower heart span at high speed, but it was stable.
After the overlord was trapped in the Infernal Abyss, the tower heart started to lose its accumulated energy due to the overlord being cut off from it violently. After the mistress dissapeared with the unborn Overlad, the minions abandoned the dark tower, leaving a few of minions to guard it in case of return. The hives were taken, but for unknown reasons, the tower heart was kept in the dark tower. Shortly after the Minion Exodus was complete, Florian Greenheart came to the dark tower (led by Rose) and tried to asorb power from the Tower Heart, but since its power can only be asorbed by the reigning overlord, it became unstable and exploded, causing a Magical Plague and decimating the surrounding land, turning it into the Wasteland.
When the Fourth Overlord first ventured into the Wastelands, he found a single shard of the Tower Heart. Some time later, he came back to collect the other shards, with the help of Florian Greenheart.
After collecting all twelve shards, Queen Fay assembled the heart and told him to recharge it with the energy from the four shrines in the depths of the Last Sanctuary. He ventured into the depths with the heart and recharged it at all four shrines.
However, the heart still was not fully charged. After Queen Fay realised that she had sacrificed the life in the sanctuary for nothing, she decided to sacrifice her own energy. The Overlord then proceeded to absorb her energy, but there was some resistance from creatures in the sanctuary, who wanted to stop him, due to them believing he had betrayed them. Queen Fay was carried off multiple times by two fairies. After chasing her around the sanctuary town, he eventually absorbed all her energy using Evil Presence, corrupting her at the same time, turning her into Dark Fay if choosing to dominate, or Ghost Fay if going with destruction.
Later the Tower Heart was returned briefly to the Netherworld Tower. Gnarl suggested a plan to attack the Imperial City directly and destroy Solarius once and for all. Unfortunately, the Anti-Magic Wall of Empire City could only be destroyed by a powerful magic relic, and for a terrible price, the Heart is chosen to be catapulted into Empire City, destroying the barrier, though the hearts energy was later absorbed by Solarius' sanctuaries for his "ascension" into a God.
It is unknown if the shards are still intact. If it is, it's possible that the shards were assembled again. But it's more probable that it was forgotten under the city ruins,waiting for the old Overlord to recover.
Overlord: Fellowship of Evil
The Tower Heart is gone, but it has been replaced with the Nether Heart, the Netherworld's version of the Tower Heart. In the game, according to the Codemasters' blog, the Netherghul must recover the shards of the Nether Heart, most likely to be ready for the return of a true Overlord.
The Tower Heart could have been based from the Palantir from the J.R.R. Tolkien's LOTR. This is assumed because they have the same form, have all seing abilities, and gives precious information to its users.
It has unmistakable value, its ancient, it's the primary weapon of the overlord (aside from the minions) and without it, it would be much more difficult to develop the overlords empire and keep him powerful.