Once a British hill resort, its importance declined and it became a sleepy little hill town. Founded by the British between 1815 and 1847.In 1849, Dharamshala originated as an army subsidiary cantonment for troops stationed at Kangra and adopted its name from an old Hindu sanctuary, called ‘Dharamshala’. . Dharamshala remained a low-profile hill town till the influx of Tibetan refugees along with the Dalai Lama since October 1959. In 1959, His Holiness, the Dalai Lama, came to Mcleodganj in Dharamshala as he had to flee from Tibet and the Prime Minister of India allowed him and his followers to settle here and they formed the Government-in-exile in 1960.

India welcomed the religious leader and offered him and his people sanctuary and a place to stay in Dharamshala. Ever since, a continuous flow of refugees has transformed the town into a miniature Tibet with Buddhist temples, schools, crafts organisations, meditation centres, library and medical centre. The upper area of McLeodganj was founded in 1848 and named after David McLeod, the Governor of Punjab

Geographically, Dharamshala is divided into Lower Dharamshala, the commercial base and the Upper Dharamshala including Mcleod Ganj and Forsyth Ganj. Surrounded by the sparkling white snowline of the Dhauladhar Mountains, McLeodganj bears the British architecture and lifestyle. Dharamshala abounds in places of religious significance, natural beauty, commercial activity and adventure.