A debate arose between Lord Shiva and Mother Parvathi as to who was more powerful among them. Shiva claimed he was, but Shakti was too voracious in her defence on the debate to establish her claim. Angry Shiva cursed her to become an Ugra kali. Realizing her haste and violent argument, Shakti begged Shiva for a remedy. Lord Said, Devas and men will be subjected to the atrocities of demons shortly. You, as Ugra Kali will destroy the demons and protect Devas and men. Then, You come to Thillai (now Chidambaram) and perform penance on me.

Chidambaram is one of the five Pancha Bootha Sthalams, the holiest Shiva temples each representing one of the five classical elements; Chidambaram represents akasha (aether). Chidambaram is glorified in Tirumular's Tirumandhiram and was visited by Patanjali and Pulikaal Munivar. It is the primary shrine of the 275 Paadal Petra Sthalams - Shiva Sthalams glorified in the early medieval Tevaram poems by Tamil Saivite Nayanar saints Tirunavukkarasar, Thirugnana Sambandar and Sundarar.

Located at a distance of 24 km from Chidambaram, the place is famous for the Siva temple dedicated to Vaidyanatheeswarar, the healer of all diseases and his consort Thaiyalnayaki. It is believed that a bath in the holy waters of the Siddhamirtham tank within the temple complex will cure all diseases. Nadi Jothidam is a traditional skill popular here. The temple is also known as Pullirukkuvelur.it is one of the important Shiva temples in the South.

The antiquities connected with the colonial period and Danish settlement at Tharangampadi are exhibited. The museum contains porcelain ware, Danish manuscripts, glass objects, Chinese tea jars, steatitle lamps, decorated terracotta objects, figurines, lamps, stones, sculptures, swords, daggers, spears, sudai (stucco) figurines and wooden objects. There is also part of a whale skeleton and small cannonballs.

The lignite mines at Neyveli are just about 30 km from Chidambaram. Neyveli Lignite Corporation Limited (NLC) is a government-owned lignite mining and power generating company in India. NLC operates the largest open-pit lignite mines in India, presently mining 24 MT of lignite and has an installed capacity of 2,740 MW of electricity. It also supplies a large quantity of sweet water to Chennai from the artesian aquifers in the lignite mines. On 11 April 2011, it joined the elite group of Navratna Companies. In 1956 NLC was formed as a Corporate body.