Bhemmuni Kolanu is located between two steep hills, which are gifted with scenic views of spectacular water falls. It was the ancient foot path to Srisailam for the pilgrims from the Southern and Western sides. This trail having remarkably laid steps of solid stone slabs can still be seen which begins from the temple complex Nagalooty.
There is a story behind how this place acquired its name. Pandavas during their pilgrimage, while they were in exile, came to this place. One day Draupadi was feeling thirsty and they could not locate water anywhere nearby. Because of this Bheema became angry and he hit the hill with his mace. It is said that the hill split into two and water came up from its middle. This stream was later named as Bheemuni Kolanu.
Pleased by the sudden flow of water, Bheema consecrated a Sivalinga at this place. According to Skanda Purana, this Sivalinga is referred as Bheema Linga and the spring as Bheema Gundam.
Presently, the remains of two ruined temples are seen there which are locally known as Bheemeswara and Bheemunikolanu temples; and both these temples date back to 8th-10th centuries A.D.
After ascending 850 steps from Bheemuni Kolanu, the pilgrims reach another place called Kailasa Dwaram. After the tiresome journey through steep hills when they finally reach a vast surface, the pilgrims feel as if they have reached Kailasa; and hence the place is named as Kailasa Dwaram.