Although Nalanda is one of the places distinguished as having been blessed by the presence of the Buddha, it later became particularly renowned as the site of the great monastic university of the same name , which was to become the crown jewel of the development of Buddhism in India. The name may derive from one of Shakyamuni's former births , when hewas a king whose capital was here. Nalanda was one of his epithets meaning "insatiable in giving."

This place saw the rise and fall of many empires and emperors who contributed in the development of Nalanda University. Many monasteries and temples were built by them. King arshwardhana gifted a 25m high copper statue of Buddha and Kumar gupta endowed a college of fine arts ere. Nagarjuna- a Mahayana philosopher, Dinnaga- founder of the school of Logic and Dharmpala- the Brahmin scholar, taught here.

A large number of ancient Buddhist establishments, stupas, chaityas, temples and monastery sites have been excavated and they show that this was one of the most important Buddhist centres of worship and culture. Regarding the historicity of Nalanda, we read in Jaina texts that Mahavira Vardhamana spent as many as fourteen rainy seasons in Nalanda.

Pali Buddhist Literature , too, has ample references to Nalanda, which used to be visited by Lord Buddha. During the days of Mahavira and Buddha, Nalanda was apparently a very prosperous temple city, a great place of pilgrimage and the site of a celebrated university. It is said that King Asoka gave offerings to the Chaitya of Sariputra at Nalanda and erected a temple there. Taranath mentions this and also that Nagarjuna, the famous Mahayana philosopher of the second century A.D.,studied at Nalanda. Nagarjuna later became the high-priest there.