It is located between Guntur district, Andhra Pradesh, and Nalgonda district, Telangana.
It was constructed between 1955 and 1967.
The dam has been proposed as a link for the Godavari-Penna River linking project.
As per the details, the Nagarjuna Sagar Dam will link the Krishna river and Penna river from the Somasila dam with a 400 km canal as part of the project.
In the future , the Palnadu Sagar dam will be built with a 700 TMC capacity reservoir to divert the waters from both the rivers for hydroelectricity purposes.
In February 2020 , the Indian government prepared a detailed project report(DPR) for linking the rivers.