The legend of Sati is associated with the destruction of Daksha's sacrifice and the origin of the Shakti Peethas of India. Sati, the wife of Shiva was the daughter of Daksha Prajaapati a descendant of Bhrama. She is known as Dakshayani. Sati married Shiva against the wishes of her father. The vain Daksha then performed a great yagna (with the sole aim of insulting Shiva), to which he invited all of the gods and goddesses except his son in law Shiva. Against Shiva's wishes, Sati attended this sacrifice and was insulted by her father. Unable to bear this insult, Sati immolated herself on the Homa.

Enraged at the insult and the injury, Shiva through Veerabhadra, destroyed Daksha's sacrifice, cut off Daksha's head and replaced it with that of a goat, as he restored him to life. Still crazed with grief, he picked up the remains of Sati's body, and danced the dance of destruction throughout the Universe. The other gods intervened to stop this dance, and the disk of Vishnu cut through the corpse of Sati, whose various parts of the body fell at several spots all through the Indian subcontinent and formed the sites of what are known as Shakti Peethas today.

Kalighat is regarded as one of the 52 Shakti Peetha of India, where the various parts of Sati's body are said to have fallen, in the course of Shiva's Rudra Tandava. Kalighat represents the site where the toes of the right foot of Shakti or Sati fell.

Legend has it that a devotee discovered a luminant ray of light coming from the Bhagirathi river bed, and upon investigating its source came upon a piece of stone carved in the form of a human toe. He also found a Svayambhu Lingam of Nakuleshwar Bhairav nearby, and started worshipping Kali in the midst of a thick jungle.

The temple is associated with the Nath/Siddha tradition. Chowringee Natha is said to have founded the Kali temple of Kalighat.

Chowringee Natha was a Nath Siddha and a disciple of Gorakshaknatha also known as Goraknatha. Legends say that Chowringee Natha was the son of King Devapala of Bengal. Devapala`s first wife died while Chowringee Natha was still a child, and his father married a woman who resorted to deception in order to place her own son on the throne. Chowringee Natha was taken to a forest clearing where his arms and legs were cut off. Here Chowringee Natha met Matsyendranatha who instructed Gorakhnatha to care for the limbless youth. Gorakhnatha taught him Yoga and after twelve years of this practice his limbs were unbelievably restored by the power of his own realization.

His name Chowringee Natha probably is derived from "Four Limbs (anga)", and the shape of his torso as a bulb. This shape of his body possibly refers to his practice of Khanda Manda yoga. The main north-south thoroughfare across the city of Calcutta is now known after his name as Chowringee.