Dharmasthala has not been content being a source of inspiration to the devout. Having expanded the meaning of Dharma to encompasses the advancement of society at large, it has played an active role in bettering the lives of communities far and wide. Its initiatives have aimed at renewing the Paid and hope within, so that people may be helped to help themselves.

800 Years ago, Dharmasthala was known as Kuduma in Mallarmadi, then a village in Belthangady. Here lived the Jain Chieftain Birmanna Pergade and his wife Ammu Ballathi in a house called Nelliadi Beedu. Simple, pious and affectionate people, the pergade family was known for its generosity and hospitality to all.

According to the legend, the guardian angels of Dharma assumed human forms and arrived at pergade's abode in search of a place where Dharma was being practiced and could be continued and propogated. As was their habit, the pergade couple hosted these illustrious visitors with all their wherewithal, and great respect. Pleased by their sincerity and generosity, that night the Dharma Daivas appeared in the dreams of Pergade. They explained the purpose of thier visit to him and instructed him to vacate his house for the worship of the Daivas and dedicate his life to the propogation of Dharma.

Asking no questions, the Pergade built himself another house and began worshipping the Daivas at Nelliadi Beedu. This continues even today.

As they continued their worship and their practice of hospitality, the Dharma Daivas again appeared before the Pergade to build separate shrines to consecrate the four Daivas - Kalarahu, Kalarkayi, Kumaraswamy and Kanyakumari. Also, Pergade was instructed to choose two persons of noble birth to act as the Daivas's oracles and four worthy persons to assist Pergade in his duties as the Executive Head of the Shrines. In return, the Daivas promised Pergade protection for his family, abundance of charity and renown for the ' Kshetra '.

Pergade, as desired, built the shrines and invited Brahmin priests to perform the rituals. These priests requested Pergade to also install a Shivalinga beside the native Daivas. The Daivas then sent their vassal Annappa Swamy to procure the linga of Lord Manjunatheshwara from kadri, near Mangalore. Subsequently, the Manjunatha temple was built around the linga.

Around the 16th Century, Devaraja Heggade invited Shri Vadiraja Swami of Udupi to visit the place. The Swamiji gladly came but refused to accept Bhiksha (food offering) because the idol of lord Manjunatha had not been consecrated according to vedic rites. Shri Heggade then requested the Swamiji to reconsecrate the Shivalinga himself. Pleased by the observance of the vedic rites and Heggade's charity to all, the Swamiji named the place Dharmasthala, the abode of religion and charity. Thus, the roots of charity and religious tolerance established by the Pergades 600 Years ago have been nurtured and strenthened by the Heggade family, Heggade being a derivative from Pergade. And today's Dharmasthala blossoms with the fruit of this selfless dedication.