The Vorlons were attempting to access a higher plane, a place referred to by them as the "well of souls," in the belief it would enable them to become the gods so many races had come to see them as.
In reality, the gateway opened a portal to another dimension, a "Thirdspace" inhabited by a violent race that posed a threat even to the Vorlons. The aliens took control of the Artifact and modified it to enhance their own telepathic abilities, allowing them to control a legion of Vorlons. The Vorlons were able to fight them back and deactivate the gate, but a group of them still controlled by the Thirdspace entities captured the artifact and jettisoned it into hyperspace. Despite searching for the device for hundreds of thousands of years, the Vorlons were never able to find it. Ultimately, it would be forgotten when they leave for beyond the Rim with the other First Ones in 2261.
Later that same year, by chance it was rediscovered by Susan Ivanova and a squad of Starfuries from Babylon 5. It was subsequently brought to the station, where the telepathic resonances influenced a team from Interplanetary Expeditions, compelling them to reactivate it. The powerful Thirdspace aliens began to enter the local space and attacked the station's defenders, resulting in a deadly pitched battle. Meanwhile, a large number of the station's inhabitants became controlled by the alien influence, starting massive riots throughout the station.
The artifact was destroyed by John Sheridan when he detonated a thermonuclear device inside the device's superstructure, after receiving the necessary knowledge of how to destroy it from Lyta Alexander (who had been "imprinted" with the knowledge by the Vorlons prior to their departure). 
When fully powered, the artifact is protected by a nigh-impenetrable energy shield that still lets friendly ships go through. The shield is so durable that the combined attack of the Army of Light, includes beam attacks from multiple Sharlin class warcruisers and Whitestars, were only able to tear a man-sized hole at its back for a brief moment.