Indra, the king of the gods, was overcome with desire for Akalika, the wife of sage Gautama. He devised a plan to seduce her by sending the sage away on an errand. Disguising himself as the sage, Indra approached Akalika. Though Akalika realised it was not her husband, she too gave in to her desire for Indra. Meanwhile, Indra transformed into a cat to escape when he sensed the sage returning. Terrified, Akalika stood frozen. Upon discovering the truth, sage Gautama became furious and cursed Indra to bear the female organs of a thousand women all over his body. He also cursed Akalika, turning her into stone. Akalika, realising her mistake, pleaded to be released from the curse.
Indra, burdened by his curse, sought the help of Brahma. Brahma advised him to worship Lord Shiva at Kurumanakkudi to atone for his sin. Following Brahma's counsel, Indra bathed in the sacred waters (Tirtha) of Kurumanakkudi and worshipped Lord Shiva. Pleased with his devotion, Shiva transformed Indra's thousand marks into a thousand eyes, thus freeing him from the curse. Hence, the deity of this place became known as Kannayiramudaiyar, meaning "Lord of a Thousand Eyes."