This shrine of Lord Shiva was developed by Sathavahanas. Amaravathi was their capital city. It was also called Dhanyakataka & Dharnikota in those days. This shrine of Lord shiva contains many efficiently carved sculptures in the premises of the temple. This shrine is also one of the Datta kshetras where Lord Dattatreya is worshipped. River Krishna flows adjacent to the temple of Lord Amareshwar and devotees take holy bath in this river. The specialty of pooja here is Abhisheka done from the upstairs, as the tip of the shiva cannot be reached from the ground level. Maa here is in the form of Bala Chamundeswari and is worshipped with great devotion.
There is a real story in vogue about the divine power of Amareshwar.
Long ago some people belonging to specific sect called chenchu, disobeyed the king and looted the surrounding villages. It was called chenchula peturi. Then the king was angry and ordered his army to execute the people of the sect. The soldiers made the people to stand in a row and chopped their head mercilessly. Lord Amareshwar wanted to punish the king for his sin of kílling the people mercilessly. The king became blind and was unable to eat food because of the illusion that the food seemed to be worms. With time the king became weak and was suffering a lot. Then the ministers of the king called for great pundits to their kingdom and pleaded them to show a way to get rid of their kings suffering. Then the pundits revealed the fact that the king was cursed for his sin of kílling innocent people. They also advised that lord Amarashwar can only bless the king, they advised the king to undertake Rudra abhisheka for lord Amareswara for 11 days 11 times a day which can make him relieved of his suffering. The king was happy and did the Rudraabhisheka for Lord Amaraswara with great devotion. He was blessed by Lord Amareswara and he got his vision and was able to eat. Lord Amaralingawara also appeared in dream of the king and ordered the to place shiva linga in the place he kílled the innocent people. The king obeyed the order and he placed 108 shiva linga in the places and built temples. It is believed that worshipping those shiva linga prevents the sin of kílling someone by mistake.