The Shihonryuji Temple comprises the Kannondo hall and the three-story pagoda. The temple is one of the oldest sacred sites in Nikko. According to legend, Shodo Shonin (735–817), the founder of Rinnoji Temple, was praying near here when he saw a great purple cloud rising over Mt. Nantai. Taking this as a message from the gods, he built a simple thatched roof hut and named it Shiunryuji, or Temple of the Rising Purple Cloud. Later it was renamed Shihonryuji, or Temple of the Four Dragons, which sounds very similar. The stone in front of the pagoda is the one on which Shodo sat when he saw the cloud. Close by there is also a stone statue of the deity Fudo Myoo and a stone fire ritual altar, both of which date to Shodo’s time.
The original Kannondo was built in 807 CE to enshrine a thousand-armed Senju Kannon. Senju Kannon is one of the three principal deities of the Rinnoji. Mt. Nantai is considered to be a physical manifestation of the Senju Kannon. This is one of the few buildings in Nikko that are built of plain undecorated wood.