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Pokhara is the meeting point for two peoples: the Hindu caste groups now inhabiting the valley and its encircling low hills, and the Gurungs of the surrounding highlands. For centuries power ebbed and flowed between them, with the caste groups gaining the upper hand as they gradually moved eastwards across Nepal.

By the 17^th century Pokhara was part of the Kingdom of Kaski, one of the most powerful of central Nepal's Chaubise Rajaya or 24 Kingdoms. Kaski was ruled by a sub-branch of the Shah royal family. The hilltops surrounding Pokhara are dotted with the ruins of medieval stone forts (kot). Kaski and the rest of the Chaubise Rajaya were annexed by Prithvi Narayan Shah in 1786 and absorbed into the growing kingdom of Nepal.

Around this time Pokhara developed into an important trade entrepôt, lying on major trails between both Jumla-Kathmandu and India-Tibet. Each winter, mule caravans arrived from the north, laden with bags of salt and wool from the Tibetan Plateau. These were exchanged in Pokhara for grain and goods carried in from Butwal by porter.

As a major government centre in central Nepal, Pokhara has naturally become a focus of development. Progress has perhaps been accelerated because it's such a pleasant place for foreign-aid workers to visit and live.

Pokhara is now the biggest tourist destination in Nepal outside of the Kathmandu Valley, drawing 25% of all visitors to Nepal.

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