The Olakkaneswara Temple was carved during the Pallava period, specifically during the reign of Narasimhavarman I (630-668 CE). The temple is contemporary with the other rock-cut monuments of Mahabalipuram, including the Pancha Rathas, the Varaha Cave Temple, and the Mahishasuramardini Cave. The Pallava dynasty, which ruled the Tondaimandalam region (present-day northern Tamil Nadu) from the 3rd to 9th centuries CE, pioneered rock-cut architecture in South India.
The site was later used by the British as a lighthouse in the late 19th century — a beacon light was placed on the top of the rock to guide ships along the coast. This dual use as a temple and nautical landmark gives the site its historical character. The temple fell into disuse as an active shrine but is maintained as part of the Mahabalipuram archaeological complex by the Archaeological Survey of India.
The British lighthouse installation involved cutting a platform into the top of the rock and mounting a kerosene-powered beacon that was visible for up to 15 nautical miles. The lighthouse keeper's quarters, built at the base of the rock, were in use until the 1920s when the Madras Port Trust assumed responsibility for coastal navigation and decommissioned the beacon.
During the 2004 Indian Ocean tsunami, the rock outcrop of the Olakkaneswara Temple served as a natural barrier, protecting the southern part of Mahabalipuram from the worst of the wave impact, and the temple structure itself remained undamaged.
