It is a very ancient sacred Lake, according to the Hindu legend. It is called by this name because it was dug out from Nails (Nakh). One story is of dug by Gods to live in, for protection against the Bashkali rakshash (a wicked demon). While other is of Rasiya Balam (a sculpture of Dilwara Jain temple), who dug the lake, as the king told that whoever will dug the lake within one night I will marry my daughter to him. But later king's wife refused and he couldn't marry the king's daughter. Temple of Rasiya Balam and Kunwari Kanya (king's daughter)'s is located behind the Dilwara Jain temple.