Terra cotta is a porous clayware with an unglazed surface. Some terra cotta samples found along the River Nile are dated back close to 10,000 BC. There are many such stunning examples of terra cotta works from Egypt dated to be as early as 5,000 BC during the Memphite Period of 5,000-3,000 BC. Some excavated terra cottas, which date back to around 3,000 BC, have been found in the Indian subcontinent. This artwork then seems to have traveled in to Kathmandu Valley after its formation. Evidence suggests that the Kathmandu Valley was a lake two thousand years ago and remained until its water finally drained from an opening at Chaubhar in the South of the valley.

Terra cotta has been practiced in Nepal since the start of the Christian era. The samples of terra cotta found in Kathmandu Valley date back close to that time. They show influences from terra cotta found in the Indian subcontinent. Entirely made of common clay, baked and left unglazed, most were essential household utilities like the tiles for roofs, jugs, pitchers, kitchenware and lamps. Other works were made for decorative purposes. Along with Kathmandu, other cities from around Nepal evidently worked with terra cotta clay structures to produce a broad spectrum of forms.

The present districts of Taulihawa and Bhairawa, west of Kathmandu, are dotted with excavations. The ruins found in Tiraulakot are said to be what is left of the ancient kingdom of Siddhartha Gautam who, enlightened, became Buddha. This region shows indications that it was destroyed by a war around two thousand years ago and subsequently abandoned. The Chinese travelers who visited this site, Fa-hsien in 403 AD and Hsuan tsang in 636 AD, commented that it is full of ruined monasteries, buildings, shrines, and stupas.

Some of the terra cotta retrieved from the excavation are: (a) Woman's head, fragment of a larger block, second to first century BC, baked grey clay, brownish red in color, height 6.5 cm, breadth 7.4 cm.; (b) bust of a woman heavily ornamented on head and ears, second to first century BC. Baked clay, pinkish color, height 8.6 cm. Breadth 6.5 cm.; (c) Damaged terra cotta of ram, second to first century BC, height 6.4 cm., breadth 9 cm. All of these examples a, b, and c are were found at Tiraulakot Kapilavastu, District of Taulihawa, and are presently at Department of Archaeology, Kathmandu. (d) Woman's head, third century AD, baked clay, height 12 cm. Breadth 9.5 cm., found at Banjarahi (near Lumbini), in District of Bhairawa, presently at Department of Archaeology, Kathmandu. (f) Ornamental bricks from a temple, medieval era, height 5.5 cm, length 15 cm., yellow baked brick, found at Lori Kudan, District of Taulihawa, presently at Department of Archaeology, Kathmandu.
Hadigoan, literally meaning "clay-pot village," is a community in Kathmandu Valley. This village was settled before the start of the Licchavi Period (300-879 AD). It derived its name from the special clay found there, which was well known for its usage in making varnished bricks. The remnants provide us with evidence that Hadigaon was occupied many times since that of the Licchavis due to their numbers and the variety of styles. Bricks and terra cotta were among the chief archeological finds during excavations in the area. We can surmise from the remains found there that the village was of great importance to the arts.

According to stone inscriptions from the time of King Amsuvarma, which were found in Guccha Tol, Kathmandu, terra cottas were highly produced since the beginning of the Licchavi period in forth century. Ancient terra cottas, which date back to that era, were also found at Dhumvarahi. These terra cottas were mostly models of waterspouts, makaras, tiles that channeled underground water to the waterspout and idols made in the Licchavi era. The terra cottas of gods and men reveal the fashion of the era, which shows great similarity to the fashion of Northern India during that time. Such terra cottas distinctly display the lapelled coat, crested crowns, and knee boots that must have been worn by the people. These remains show that since early centuries terra cotta has been an essential part of the arts in the country.

Terra cotta works found from the Malla period (1200-1769) were mostly molded to cover temples, viharas, and homes. Some idols of gods, goddesses, animals, and showpieces of different forms were also made. An exceptional terra cotta art complex was built in Patan during the late sixteenth century and named the Mahabaudha Temple (sikhara) and housing hundreds of terra cotta Buddhas. Aside from Buddhas, there are many other terra cotta forms that were used for decorating the temple. According to chronicles, the complex was built similarly to the celebrated Bodhgaya Temple. A pilgrim was known to have brought with him a model of Bodhgaya Temple for the purpose of building such a complex in Kathmandu. The beauty of the terra cottas found in Mahaboudha explains how well the art had been established in the country by that time. A terra cotta latticed window, which was very similar in design to the wooden latticed windows of 250 years ago, can be seen in Chokhachein, at Bhaktapur. King Rajya Pratap Malla made a huge terra cotta lamppost in 1808 that is exhibited only on the day of the full moon during the month of Kartik. Some examples of terra cottas found from the Malla period are: (h) Head of Goddess Camunda, Lord Shiva's wife Kali, baked red clay, eighteenth century AD, height 29.7 cm. Breadth 26 cm. Presently at Bhaktapur Museum; (i) Virupakshya, the god Bhairava, eighteenth century AD, baked red clay, height 24 cm. Breadth 19.5 cm, Nepal Museum, Kathmandu;(j) Bhima, one of the heroes of epic Mahabharata, killing five men, red clay, height 26 cm. Breadth 20.5 cm. Nepal Museum, Kathmandu.

In 1757, Jayaprakash Malla, the last Malla king of Kathmandu, built a temple in the Kathmandu Durbar Square, known as the Kumari Ghar. Erected for the worship of Kumari, the virgin state of the goddess Durga, this temple was built in the image of the Newari vihara and displays fine examples of terra cotta tiles from that time.