Nilagiri, situated at a distance of 32 km from Chandipur, is a town which is close to the vicinity of Nilagiri Hills. Nilagiri, as the name suggests means ‘Blue Mountains’, has earned its name from the apparent blue color of the hills. On top of one of these hills lies the Panchalingeswar Temple. The royal palace and the Jagannath Temple adjacent to it are also places of attraction in Nilagiri.
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Antique gold and diamond ornaments along with the royal dresses worn by the then Kings and Queens of Nilagiri are kept for display inside the palace. Several eateries are put up by the road side. A spectacular Khumkut Dam can be visited which is located quiet near to this town. A very old light house stands erect close to the dam. Nilagiri is also famous for its sweets. One can relish mouth watering delicacies at the Katchery bazaar.