Manikaran is a pilgrimage centre for Hindus and Sikhs. The Hindus believe that Manu recreated human life in Manikaran after the flood, making it a sacred area. It has many Temples and a Gurudwara. There are temples of Lord Rama, Krishna, and Vishnu. The area is well-known for its natural hot-water springs and its beautiful landscape.

According to a legend, when Lord Shiva and his better half Parvati were walking in the valley, Parvati dropped one of her earrings. The jewel was seized by Shesha-Nag, the serpent deity, who then disappeared into the earth with it. Shesha-Nag only surrendered the jewel when Shiva performed the cosmic dance, the “Tandava” and shot the jewel up through the water. Apparently, it is said that jewels continued to be thrown up in the waters at Manikaran until the earthquake of 1905.

According to Sikhs, during third Udasi, Guru Nanak Dev ji came to this place in 1574 Bikrami with his disciples Bhai Bala & Bhai Mardana. Sri Guru Nanak Dev Ji was with Bhai Bala and Bhai Mardana in Manikaran region and Bhai Mardana felt hungry and they had no food. Guru Nanak sent his good Friend Bhai Mardana to collect food for langar (the Community Kitchen). Many people donated flour (atta) to make Roti (bread). The one problem was that there was no fire to cook the food. Guru Nanak Asked Mardana to lift a stone and Bhai Mardana then lifted a rock and a hot spring(hot water) appeared. As directed by Guru Nanak Dev ji, Mardana put the rolled chappatis in the spring to his despair the chappatis sank. Guru Nanak then told him to pray to god saying that if his chappatis float back then he would donate one chappati in the name of God. When he prayed all the chappatis started floating duly baked. Guru Nanak Dev Ji said that anyone who donates in the name of God, his or her drowned items float back.

The legend of Manikaran states that while roaming around, Lord Shiva and Goddess Parvati, once chanced upon a place that was surrounded by mountains and was lush green. Enamoured by the beauty of the place, they decided to spend some time there. It is believed that they actually spent eleven hundred years here. During their stay here, Goddess Parvati lost her mani in the waters of a stream. Upset over the loss, she asked Shiva to retrieve it. Lord Shiva commanded his attendant to find out the mani for Parvati, however, when they failed, he was extremely angry. He opened his third eye, a tremendously inauspicious event which led to disturbances in the universe. An appeal was made before the serpent god, Shesha-Nag, to pacify Lord Shiva. Shesha-Nag hissed thereby giving rise to a flow of boiling water. The water spread over the entire area resulting in the emergence of precious stones of the type Goddess Parvati had lost. Lord Shiva and Goddess Parvati were happy at the outcome.

The name Manikaran is derived from this legend. The water is still hot and is considered extremely auspicious. A pilgrimage to this place is thought of as complete. It is also believed that there is no need to pay a visit to “Kashi” after visiting this place. The water of the spring is also supposed to have curative powers. The water is so hot that rice for the “langar” is cooked by putting it into a linen-bag and dipping it into the boiling water.