Founded in 1854 by Lord Dalhousie, then Governor-General of India, the city was considered as a retreat to escape the Indian summer, offering a peaceful & pleasant climate. To convert the area into a hill-station, the five neighbouring hills- Bhangora, Bakrota, Terah, Potreyn and Kathalagarh were acquired by the Chamba rulers. Soon after, Dalhousie became a much-awaited hill destination that became popular as a tourist attraction for all. Dalhousie became a part of the Gurdaspur district in the year 1861. It became a part of Himachal Pradesh only in 1966. It continues to serve as a popular tourist destination.