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Pushkar derives its literal meaning from the Sanskrit word 'Pushkar', which means blue lotus. The name of the place has links to a mythological tale. The legend has it that the demon Vajra Nabha killed Brahma's children; he in turn struck him with his weapon, a lotus flower. Vajra Nabha died with the impact, and the petals of the lotus fell at three places. One of them is Pushkar, where a lake was formed. Brahma performed austerities at the lake on Kartik Purnima, hallowing the place.

The city of Pushkar is also closely associated with the times of the Ramayana and the Mahabharata. In later times, Pushkar was an important place during the reign of the Mughals. It was the favored place of residence of many important Mughal rulers. Later, Pushkar became a part of the British Empire.