Shambhala, also known as Shangri-La was a mythical city hidden in the Himalayas. Many people, dating all the way back to the 1600s, searched for it. Despite its location, its climate was different from the world outside; it was much more of a tropical climate instead of the snowy climate of the Himalayas, which was the reason it was considered an earthly paradise. The fabled Cintamani Stone was hidden there. The entrance to Shambhala is hidden inside a remote, abandoned monastery in Tibet, and guarded by creatures known as the Shambhala Guardians.
Marco Polo and his caravan were the first to discover the city on their way back from Kublai Khan's court. He left behind a series of clues that were picked up by Lazarevic, and then by Drake; A map hidden within a Mongolian oil lamp, a Phurba and map amongst the survivors of the lost fleet, a three-dimensional stone map inside a temple (revealing the location of the monastery), and various writings that alluded to the Cintamani Stone. Centuries later & 70 years prior to the start of Uncharted 2: Among Thieves, an SS expedition sent by the Ahnenerbe attempted to find the entrance to Shambhala in an ice cave, before being corrupted because of their ingestion of the resin native to Shambhala; they were killed by their guide, Karl Schafer.
In order to find Shambhala, one needed to have a certain phurba. If one had it, they would go to the Valley of Temples in modern-day Nepal to find a temple. Only a single temple in the valley would be valid; this would be deduced through sharing similar markings on the phurba. Once one entered the temple, he/she would have to solve a puzzle by moving a statue's hands; once the hands were in correct placement, the phurba would be entered into the stomach section of the statue and an underground passage would be revealed. One would have to be careful of traps, such as a descending ceiling with spikes. Once one exited, they would come across another puzzle utilizing light; after solving it, they would go even further underground and come to a rotund chamber. He/she would place the phurba into the solitary pedestal and a 3-D model of the Himalayas would rise up from the ground, with the one beam of light shining down showing the location of the monastery that hid the entrance to Shambhala. If one chose to travel to the monastery, he/she would go the highest tower and solve a puzzle that would reveal a switch. Once the phurba was inserted into the switch, and once the switch itself was turned, the secret path would be revealed. At the end of the path, two big daggers on the wall had to be turned, and the brazier in the middle had to be lit with blue resin. This would reveal tiny pocket which one would insert the phurba into. Once said action was done, the gates to Shambhala would be revealed. By turning cylinders on the wall, the gates would open and the city would be revealed.
Even though many people believed that the Cintamani Stone was the biggest treasure of the city besides the city itself, this was not the case; it was the resin from the Tree of Life and the Tree of Life itself that were the city's biggest treasures. The city was destroyed when Nate defeated Lazarevic by exploding the roots of the Tree of Life; the resulting explosions made the city crash.
- Shambhala was renamed 'The Lost City' for the Uncharted 2 Multiplayer mode.