Bouddhanath is among the largest stupas in South Asia, and it has become the focal point of Tibetan Buddhism in Nepal. The white mound looms thirty-six meters overhead. The stupa is located on the ancient trade route to Tibet, and Tibetan merchants rested and offered prayers here for many centuries. When refugees entered Nepal from Tibet in the 1950s, many of them decided to live around Bouddhanath. They established many gompas, and the "Little Tibet" of Nepal was born. This "Little Tibet" is still the best place in the Valley to observe Tibetan lifestyle. Monks walk about in maroon robes. Tibetans walk with prayer wheels in their hands, and the rituals of prostration are presented to the Buddha as worshippers circumambulate the stupa on their hands and knees, bowing down to their lord.

Many people believe that Bouddhanath was constructed in the fifth century, but definite proof is lacking. The stupa is said to entomb the remains of a Kasyap sage who is venerable both to Buddhists and Hindus. One legend has it that a woman requested a Valley king for the donation of ground required to build a stupa. She said she needed land covered by one buffalo's skin and her wish was granted by the King. She cut a buffalo skin into thin strips and circled off a fairly large clearing. The king had no choice but to give her the land.

The Boudha area is a visual feast. Colorful thangkas, Tibetan jewellery, hand-woven carpets, masks, and khukuri knives are sold in the surrounding stalls. Smaller stupas are located at the base. Gompa monasteries, curio shops, and restaurants surround Bouddhanath. Conveniently situated restaurants with roof-top patios provide good food and excellent.