Good prose, Orwell would have you believe, is like a window pane. Had Orwell been Simon Mawer, he might have specified what kind of window pane he had in mind, where, when and in what lighting. The Glass Room is full of windows that are smeared, windows that reflect or diffuse light, that shatter. "Refraction of the daytime," as one character puts it, "become reflection of the night." Every window is a potential two-way mirror. A broken shard is a knife.

The room of the novel's title  Der Glasraum  is the vast living room in Viktor and Liesel Landauer's modernist house, a masterpiece built for them by ascendant architect Rainer von Abt, with plate-glass walls and a partition made of pure onyx. This is Czechoslovakia between the wars, with Von Abt's iconoclastic building as a symbol of a young country in a new world, and of the wealthy Landauers' new marriage. When war comes again, Viktor, a Jew, flees with his young family. The marriage begins to fail. Civilised Europe has already failed. Miraculously, though, the Glass Room remains, repossessed by successive armies and ideologies, yet always drawing its inhabitants back and holding layers of history in its uncommon space.

Mawer's technique here is a form of the historical layering that he previously plied in Swimming to Ithaca and The Fall. Five sections move the story from 1928 through Nazi occupation, Soviet control and the Prague Spring to the aftermath of the Velvet Revolution. Like the house, the novel is flawlessly constructed, revealing the careful plan of its reflections and symmetries, the lines of force hidden in its surfaces and its concealed architecture. Its only snag is that the final blueprints seem, if anything, too neatly drawn, too traditional: the book could have done without its sentimental coda.

That aside, The Glass Room, shortlisted for last year's Booker Prize and this year's Jewish Quarterly Wingate Prize, is Mawer's finest work so far. From the materials of the house itself he draws unexpected resonances, candescent onyx balancing pellucid glass, and that glass itself shifting between aspects. When the house becomes a research outpost of Nazi racial science, we think of the test tube and the Petri dish; when a Soviet bomb shatters the room, the shard-carpeted cities of Europe come to mind. And always at the back of the mind, as the Jewish characters flee their homes, are the hideous shatterings of Kristallnacht.

Simon Mawer's latest book is a historical novel set in Czechoslovakia in the late 1930s. Historical novels are usually possessed of horrid, obvious and multiple weaknesses and flaws - bogus dialogue, fetishistic images and scenes, ignorant conflations: sinister, ersatz entertainment. And although Mawer is the author of a number of rather fine novels - including The Gospel of Judas and The Fall - he is probably best known for his Peter Mayle-ish A Place in Italy (1992). So the omens are not good. And all the initial signs are unpromising: The Glass Room is a book about a culture slipping from decadence into catastrophic decline. It's a study of a marriage. It concerns itself with art, music, architecture, indignity, loneliness, terror, betrayal, sex. And the Holocaust. It should, therefore, be pretentious, unbearable schlock of the most appalling kind. But it's not. It is, unexpectedly, a thing of extraordinary beauty and symmetry.

The Glass Room is a novel of ideas, yet strongly propelled by plot and characterised by an almost dreamlike simplicity of telling. Comparisons with the work of Michael Frayn would not be misplaced, and there are occasional moments of illuminating brilliance, when the novel becomes like the Glass Room of the title. "It had become a palace of light, light bouncing off the chrome pillars, light refulgent on the walls ... It was as though they stood inside a crystal of salt."

But one should, of course, enter the book by the main entrance, via the plot. Wealthy Jewish car manufacturer Viktor Landauer and his gentile wife Liesel have been made a gift of land by Liesel's parents to build their own house. "Something good and solid," Liesel's father advises. But Viktor doesn't want something good and solid: what he wants is something modern. And what he gets is a modernist masterpiece, Der Glasraum, the Glass Room.

The architect employed by Viktor is a man named Rainer von Abt, a disciple of Adolf Loos. "I wish to take Man out of the cave and float him in the air," Von Abt proclaims. "I wish to give him a glass space to inhabit." The house, when it is built, has vast windows, an onyx wall, white ceilings and white floors. It is the definitive modern house, for definitive modern people. Viktor is a great believer in inovace and pokrok - innovation and progress. "Everywhere he takes with him the new creed and proclaims it with all the enthusiasm of a prophet. 'This is where the world of commerce is leading us,' he explains. 'Into a world of peace and trade, where the only battles fought are battles for market share.'" It's the late 1930s: Viktor is woefully mistaken.

The Glass Room is not merely a piece of architecture within the book: it is the architecture of the book. All the characters interact with and within the house in some way; all plot revelations take place within its shimmering walls; history doesn't take place outside it, it comes to it. Abandoned by the fleeing Landauers, the Glass Room is taken over by the Nazis for scientific experiments, and then claimed by the communists, before becoming a museum, and the site for a final scene of recognition and redemption. This could easily be over-ingenious or simply absurd, a device ripe for parody. Exactly how Mawer manages to avoid the many potential embarrassments and pitfalls he sets up for himself is worth considering.

First, he purges his sentences of metaphor and simile, preferring instead the devices of parallelism and symbolism. Thus, through balance, proportion and careful arrangement of both sentences and plot, he transcends mere cleverness to become profound. When Liesel falls pregnant, for example, it's obvious that the house and the baby will become competing symbols of growth and development. The reader prepares to groan. But Mawer resists obvious sentimentalising and sticks to the facts, plus vague abstraction. "The house grew, the baby grew ... The growth of the house was more measured: the laying of steel beams, the pouring of concrete, the encapsulating of space." Such effects lend to the prose a spirit of quiet wisdom.

There is also the potential problem of voyeurism: passionate encounters excite and disrupt the plot throughout, and there is much of what the critic Leslie A Fiedler once memorably called "consummated genital love". The Glass Room is again the site for many of these encounters, opening up intimate sexual terrors and pleasures to the vast outer world of politics and history.

As it draws towards its inevitable conclusions, the novel becomes perhaps too comfortable a read. But to deplore endings is a commonplace of criticism. More serious a fault are those few occasions when Mawer's narrative omniscience verges on bombast, as when Viktor begins to feel guilty about his affair with a young woman. "Perhaps it is nothing more than an irrational gesture of the mind, an association of thoughts that would intrigue that other Moravian-German Jew Sigmund Freud, at this very moment at work in Vienna on the first draft of what will be his final book, Moses and Monotheism."

Such moments stand out because the book otherwise rarely strains to demonstrate its purposes or intelligence. The Glass Room is a rare thing: popular historical fiction with integrity. When they make it into a film, which they will, they'll ruin it.

 Ian Sansom's The Delegates' Choice is published by Harper Perennial