Khajjiar Lake, at an altitude of 1951 m above the sea level, is at the center of the grassy glade of Khajjiar, which is 20 km from Dalhousie. The surrounding of the lake is spongy due to the dense growth of weed called vacha. Fed by slim streams, this lake is the main water source of the sanctuary area of Kaltop in Chamba District.
Khajjiar Lake is considered holy by the locals, as there is a magnificent temple on its brink. Khajji Nag, a serpent god, is the main deity of this temple and the derived its name from this deity. A religious fair is held here annually.