Chamunda Devi is a Shakti shrine, 10 km west of Palampur, on the Baner River. This colourful shrine has a wrathful form of Durga or Chamunda. The idol in the temple is considered so sacred that it is completely hidden beneath a red cloth.

According to the legend, Chamunda Devi killed Chand and Mund demons who tried to harass Goddess Ambika. Hence the Kali is worshipped as Chamunda.