The proposal to construct a dam to use the excess waters of the Krishna river was put forward by the British rulers in 1903. Siddeswaram and Pulichintala were identified as the suitable locations for the reservoirs
The construction of the dam submerged an ancient Buddhist settlement, Nagarjunakonda, which was the capital of the Ikshvaku dynasty in the 1st and 2nd centuries, the successors of the Satavahanas in the Eastern Deccan. Excavations here had yielded 30 Buddhist monasteries, as well as art works and inscriptions of great historical importance. In advance of the reservoir's flooding, monuments were dug up and relocated. Some were moved to Nagarjuna's Hill, now an island in the middle of the reservoir. Others were moved to the mainland
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