The name `Chamunda` originated from the name of two monsters Chanda and Munda, who were killed by the Devi. According to an ancient legend the Goddess Chamunda was enshrined as Chief Goddess with the title `Rudra` in the battle between Lord Shiva and the demon, Jalandhara. Since the place is known as Rudra Chamunda. The famous Chamunda Nandikeshwar Dham is an abode of Shiva Shakti following the sagas of Purana. In another legend it is stated that Chamunda emerged as Chandika Jayasundra from an eyebrow of Goddess Kaushiki during the battle of `Savarni Manamantra` between gods and demons.

She was assigned the task of killing two demons `Chand` and `Mund`. Chamunda fought a fierce battle with these two monsters and finally won over them and assassinated them. Then Chandika Jayasundra took the slain heads of the two demons to the goddess Kaushiki, who was immensely pleased at her success, blessed her and bestowed her with the title `Chamunda`. Since then the goddess is famous with the name Chamunda.

There is also a legendary story about Goddess Chamunda. It is about the famous temple of Devi Chamunda in Kangra District of Himachal Pradesh, India. About four hundred years ago the King and the Brahman priest prayed to the goddess for the permission to move the temple in an easily accessible location. The goddess Chamunda appeared before the priest in his dreams and granted their prayer. She also directed the priest to dig in a certain spot where they would found an old idol, which has to be installed in the temple and worshipped as her form.

The king sent out his men to dig up the idol. The men could locate it but was unable to lift it up. Goddess Chamunda again appeared in the dream of the priest and explained that they were not able to lift the whole relic as they considered it as ordinary stone. The Goddess also asked the priest to get up early in the morning, take bath, wear fresh clothes and go to that place as clean and pure with a respectful mind. The Priest did the same as he was instructed to do by the Goddess and could easily lift the idol alone which a large group of men could not do. The idol of Goddess Chamunda was established in the temple and worshipped. In some forms, Goddess Chamunda is adorned by serpents, scorpions and skulls.

Chamunda is also known by names like Chamundi, Chamundeshwari and Charchika and is also considered as one of the seven Matrikas. She is also one of the chief Yoginis. She is closely associated with Goddess Kali which is another fierce aspect of Devi. She is worshipped by ritual animal sacrifices along with wine offerings and in the ancient times human sacrifices were also offered. Initially Chamunda is a tribal goddess who was incorporated later in Hinduism.

In India there are a considerable number of temples devoted to Goddess Chamunda. Some of the renowned temples are Chamunda Devi temple in Himachal Pradesh, the two Chamunda shrines in Gujarat, Charchika Temple in Orissa and Chamundeshwari temple in Mysore.