The mythology of Daksha yaga and Sati's self immolation had immense significance in shaping ancient Sanskrit literature and even had impact on the culture of India. It led to the development of the concept of Shakti Peethas, thereby strengthening Shaktism. When Shiva was insulted by his father in law (i.e., Daksha), his wife Sati Devi was so angry that she jumped into the flames of the yagya (a ritual involving offerings to a sacred fire). Shiva was grief-stricken and picked up her corpse and began to wander about, as her body parts fell to the earth. There are 51 Shakti Peethas which are believed to be enshrined with the presence of Shakti due to the falling of body parts of the corpse of Sati Devi, when Lord Shiva carried it and wandered throughout Aryavartha in sorrow. The 51 Shakti Peethas also correspond to 51 letters of the Sanskrit alphabet. One view is that Guhyeshwari Temple marks the spot where Sati's hips or hind part is said to have fallen.
The term guhya is often mistaken as referring to vagina. The genitals of Sati Devi is said to have fallen at another Shakti Peeth worshiped by the name "Kamarupa-Kamakhya" in Assam. Another version is that Guhyeshwari Temple marks the place where both the knees of the goddess is said to have fallen. Each Shakti Peeth is dedicated to a Shakti and a Kalabhairava. In Guhyeshwari Temple, the Shakti is Mahashira and the Bhairava is Kapali. The goddess is worshiped at the centre of the temple in a kalasha (water jar) that is covered with a layer of silver and gold. The kalasha rests on a stone base which covers an underground natural water spring, from which water oozes out from the edges of the base.
The temple stands at the centre of a courtyard and is topped with four gilded snakes that support the finial roof. This temple is revered by Tantric practitioners, and Tantric rites are performed in this temple. The temple is also mentioned in the Kali tantra, Chandi tantra, and Shiva tantra Rahasya and is regarded as one of the most important places for gaining the power of tantra. The Vishwasorup of goddess Guhyeshwari shows her as a many and different coloured headed goddess with innumerable hands. The temple gets much crowded during Dashain and Navaratri.
Vajrayana Buddhism
Newari Vajrayana Buddhists consider Guhyeshwari to be sacred to Vajrayogini in the form of Vajravarahi and to be the location of root of the mythical lotus upon which Swayambhunath stupa rests, which is also the umbilical cord that nurtures Kathmandu. In Tibetan language, the place is called Pakmo Ngülchu (Varahi's womb fluid). The water which flows from the spring in the well of the temple is believed to be vaginal discharge, likely amniotic fluid, or waters of Vajravarahi.
Architecture of Guhyeshwari Shaktipeeth
Guhyeshwari Temple seems to be quite elegant and this temple is designed in Bhutanese pagoda style of architecture. Though the exterior of the temple is quite simple and not very attractive, But the inside of the temple is well decorated with flower motifs and structures.
Hindu and Buddhist Assimilation:
The Buddhist Newar community performs various Puja at Guhyeshwari Temple. Newari Bhoj (feast) is also held at the temple during festivals. Newar Bajracharya Buddhists worship Guhyeshwari as Vajrayogini.