There is a myth about Hindu priest from Java called "Dang Hyang Nirartha" or " Peranda Sakti Wawu Rauh", full of mystical episodes since his arrival until his disappearance in Bali. The story of this priest written on palm leaves called "lontar" in middle Balinese language mixed with old Javanese and Sanskrit. It is not known weather the story was written by this priest himself or other priest who wish to promote the name of priest to have been one having merit for Balinese. The story is strongly influneced by the literature of India such as speculation of Sorga ( heaven ) which is the same as other religion that is concerning the world after death or the "here after" This world is contrasted into two polarization such as Eden and hell. For those devotees, a promise of all goodness and happiness are there which is called "sorga" In the tradition of Hindu in Bali it is said that the "sorga" is undescribed by pen, unexpressed by word, and undepicted with picture. Where truth is an absolute, and body is embraced into it, so it is only exist " enlightenment". But one can not enter the sorga with worldly body except their holy spirit when he/she during his/her life had completed duties and behaved as indicated by conducts indicated by the literature. The other way one can reach sorga by the way called "moksa". It is not quiet clear what is actually meant by the word "moksa". Many assumptions arose. One thought it is a body sublimation, that one who has reach his stage of moksa disappeared in the world without living his/her physical body. This stage can only be reached with a severe body control or obstinent of senses, while developing knowledge by meditation or hermitage. Others thought that when a person dead, their spirit become one with the absolute being, and will not experience rebirth ( Sanskrit : samsara ) anymore. Since life is basically a punishment of previous sins and misdeeds of their past life ( Sanskrit : Punarbawa ). So, actually based on the last thought, human being during his life is stirred to do the good thing.

Dang Hyang Nirarta is believed the one that have reached such stage, and he accomplished his moksa on a spot of land which is believed to be the sacred place. In this sacred place then it was built a temple called Ulu Watu. That was why the place has been considered a very special place by the king in the past. It is not only Uluwatu temple that is associated with Dang Hyang Nirarta, but many temple such as Ponjok Batu at North West Bali, Rambut Siwi in Kabupaten Negara and Sila Yukti in East Bali. It is probably the claim of Hindu priests in the past that their role in the society was unquestionable.

Other side of above story, one phenomenon is certain during Balinese history that was during the disintegration period of Balinese kingdom ca. 18th century to early 20th century many small kingdoms strove hard to build their identification to at least comparable to Klungkung kingdom. Klungkung kingdom was the main kingdom of Bali which overuled Bali since 1343 to 1651 effectively. The foremost one as the aspect of aknowledgement was the temple. Each kingdom would build one sea temple, one city temple, and one mountain temple. There are 8 kingdoms still alive in Bali, when Indonesia announced the declaration of Independence in 1945. Each of this kingdom had their own 3 main temples. At the level of smaller social unit such as " Desa " another 3 temples are also built to indicate the consistency of the tradition from upper level up to the lowest which is called Kahyangan Tiga or three temples. Uluwatu is belong to Badung kingdom with the capital city of Denpasar until 2000 when administratively Denpasar separated from the administration of Kabupaten Badung to upgrade it's status into a municipality having the same level as Kabupaten administration.

The kingdom of Badung was divided into 2 kingdoms during 17th century, one the bigger was Mengwi kingdom covered almost bigger part of Badung current area and part of Tabanan regency, even Blambangan regency in east Java which is now Kabupaten Banyuwangi . Uluwatu was most probably built by Mengwi kingdom as sea temple, at the same time as Ulun Danu as mountain temple. The development of the kingdom later obliged Mengwi kingdom to give Uluwatu temple to Badung kingdom, and Ulun Danu to Tabanan kingdom. Shortly after 1634 AD Mengwi again built other 2 temple, one is Tanah Lot as sea temple, and other is Pucak Mangu temple in Pelaga area as mountain temple.

Today it is not only the area of Badung and municipality of Denpasar feel that Uluwatu is their temple or as Bali main temple ( Bali "Sad Kahyangan" ) but other areas of Bali which were residents of different kingdoms in the past. The main holder of the temple who daily look after it, and bear the responsibility of the temple maintenance and ceremony is one of the king family in Denpasar, under the regency of Badung.