Sri Varaha Lakshmi Narasimha Temple is a 11th Century temple dedicated to Lord Varaha Narasimha. The Sthala Purana of Simhachalam recounts the history of the great devotee Prahlada Maharaja and his demonic father, Hiranyakashipu. After many unsuccessful attempts to kill Sri Prahlada, Hiranyakashipu orders, as a last resort, to hurl Sri Prahlada into the sea and place a huge mountain over him. The servants chose to do this at Simhachalam. But before they could finish, Narayana rescued Prahlada by jumping over the hill and lifting him from the sea. Simhachalam, therefore, is the place where the Lord rescued Prahlada. The Lord then assumed the form of the Varaha-Narasimha Deity to kill Hiranyakashyapu.

After the death of Hiranyakashipu, Prahlada built a temple around the Deity. It is said that after Prahlada handed over the kingdom to his son, he worshipped the deity personally. However at the end of Satya Yuga, owing to neglect perhaps, a huge anthill gathered around the Deity. But at the beginning of another yuga the Deity was rediscovered by Pururava, the king of the lunar dynasty, who is mentioned in the Ninth Canto of the Srimad-Bhagavatam.

The idol of the deity is overcovered with a thick coating of sandal paste, which is said to have appeased the fury of the Lord after the destruction of Hiranyakasipu. This coating is removed only once a year, on the Visaka day in May, and that day is considered to be especially sacred.