This temple dedicated to Krishna or Venugopala has an interesting mythological genealogy. Apparently, Gollapalli (Puttaparthi's earlier name) was a prosperous village of cowherds at one time. However, evil fortunes fell upon the village when one incensed cowherd hurled a stone at a cobra that was sucking milk from the udder of one of his cows. The dying cobra cursed the village, and as a result, the cattle began to perish, and the place was infested with ant-hills. Its name was now changed to Valmikipura (the word 'Valmiki' denoting 'anthill' in Sanskrit, and Puttaparthi being the Telugu equivalent of the same).
In an attempt to appease the spirit of the dead snake, the villagers installed the blood-splattered stone in a shrine and started worshipping it. Sathya Sai Baba instructed them to wash it and smear it with sandal paste. On doing this, the outline of the figure of Krishna (or Venugopala) holding his customary flute, became discernible. The temple was now called the Venugopalaswamy temple, and the curse on the village of Puttaparthi came to an end.