From: This website

What became known as the Dro Tradition dispenses with Tsilupa altogether. Instead it begins with Shripala, the 17th Khalkin King of Shambhala. Immediately we are faced with a chronological problem, since it is generally accepted that the Kalachakra was introduced into India in 966-67 or, in the context of the Legend of Shambhala, during the reign of the twelth Khalkin King, Surya, when Islam was rapidly advancing through Central Asia. This was hundreds of years after the reign of Shripala. Shambhalists have explained away this discrepancy by maintaining that Shripala is simply another name for Pindo Acharya, apparently the same Pindo Acharya who popped up in the Rva Tradition account.

That may be the case, but the tale of Shripala, although legendary in nature, does contain a curious detail which might pertain to the actual physical location of Shambhala. According to the Dro Tradition a young man, the son of two yoga practioners, heard that boddhisattvas themselves were teaching the Dharma somewhere to the north of India in the country of Shambhala. Eager to learn the Dharma he set out on a journey to find these teachers. Beyond India but before reaching Shambhala, we are told, he encountered a vast desert which would have taken four months to cross.

One may speculate here that the desert in question is the Taklamakan Desert of western China. As noted earlier, the Uighur kingdom of Khocho, located at the northern edge of the Taklamakan, has often been posited as the "historical" Shambhala. To reach Khocho from the southern edge of the Taklamakan would indeed have taken four or more months, depending on what route the traveler took. Is it possible that a geographical factoid somehow became embedded in this mythologized account of King Shripala?

In any case King Shripala, using his pyschic powers, soon learned of the young man's approach and ascertained that his motives were pure. Afraid that the young man would perish trying to reach Shambhala, King Shripala sent his emanation body to meet him at the southern edge of the desert. King Shripala, in his emanation body, told the young man it was not necessary to go to Shambhala to obtain the teachings he desired and that he, King Shripala, could tell him all he needed to know right there.

For four months the young man studied under Shripala and eventually returned to India with the Kalachakra doctrine and other teachings in hand. He then became known as Kalachakrapada the Elder. If we accept the identification of Shripala as Pindo Acharyas, then of course it would have been from Pindo Acharyas that Kalacakrapada the Elder learned the Kalachakra. Kalacakrapada the Elder in turn passed on the Kalachakra doctrine to Kalacakrapada the Younger, who as in the Rva Tradition is usually identified with Napendrapa, i.e., Naropa.

Unlike in the Rva Tradition, however, Naropa is said not to have appeared at Nalanda and debated with the monks there. Instead a Kashmiri pandit named Somanatha came to the monastery of Viramashila, in Magadha, where both the Kalachakrapas were staying, and learned the Kalachakra doctrine from them. The Dro lineage, then, was passed down from Naropa down to Somanatha, just as the Rva lineage was passed from Naropa to Manjukirti. "Thus the lineage of Naropa is probably the only Kalachakra tradition that has come down to us today in an unbroken transmission," notes one prominent Shambhalist.

There are other versions of the transmission of the Kalachakra teachings from Shambhala to India, but we'll stop here, not only because, as another commentator has pointed out, "Any given story of the introduction of the Kalachakra into India can be contradicted by another, equally venerable story," but also because with the introduction of Naropa into the scenario we can leave the quagmire of myth and proceed on firmer historical ground.

From this website:

Blavatsky’s placement of Shambhala in the Gobi Desert is not surprising since the Mongols, including the Buryat population of Siberia and the Kalmyks of the lower Volga region, were strong followers of Tibetan Buddhism, particularly its Kalachakra teachings. For centuries, Mongols everywhere have believed that Mongolia is the Northern Land of Shambhala and Blavatsky was undoubtedly acquainted with the Buryat and Kalmyk beliefs in Russia.

Blavatsky might also have received confirmation of her placement of Shambhala in the Gobi Desert from the writings of Csoma de Körös. In an 1825 letter, he wrote that Shambhala is like a Buddhist Jerusalem and lay between 45 and 50 degrees longitude. Although he felt that Shambhala would probably be found in the Kizilkum Desert in Kazakhstan, the Gobi also fell within the two longitudes. Others later would also locate it within these parameters, but either in East Turkistan (Xinjiang, Sinkiang) or the Altai Mountains.

Although Blavatsky herself never asserted that Shambhala was the source of The Secret Doctrine, several later Theosophists made this connection. Foremost among them was Alice Bailey in Letters on Occult Meditation (1922). Helena Roerich, in her Collected Letters (1935-1936), also wrote that Blavatsky was a messenger of the White Brotherhood from Shambhala. Moreover, she reported that in 1934 the Ruler of Shambhala had recalled to Tibet the mahatmas who had transmitted to Blavatsky the secret teachings.

Blavatsky might also have received confirmation of her placement of Shambhala in the Gobi Desert from the writings of Csoma de Kцrцs. In an 1825 letter, he wrote that Shambhala is like a Buddhist Jerusalem and lay between 45 and 50 degrees longitude. Although he felt that Shambhala would probably be found in the Kizilkum Desert in Kazakhstan, the Gobi also fell within the two longitudes. Others later would also locate it within these parameters, but either in East Turkistan (Xinjiang, Sinkiang) or the Altai Mountains.

From this website:

Naadam, Mongolia -- The mystical land of Shambhala has risen again in the eastern Gobi Desert of Mongolia. On Sunday, September 10, thousands of Mongolians and foreign visitors gathered near Khamariin Khiid in Dornogov Aimag for a dawn-to-dark celebration.

From this website:

Around 1000 years ago, an extraordinary spiritual composition called the Kalachakra Tantra appeared in northern India. Its mysterious origin, profound practice system and dire prophecies would deeply impact the Buddhist world across Central Asia up to and including an obscure, sandswept corner of Mongolia's eastern Gobi desert. There in 1853, at his seat in Khamar Monastery, a tremendously charismatic lama named Danzan Ravjaa, the 5th Wrathful Dharma Lord of the Gobi, called his disciples together. Sharing with them his meditative insight and disturbing visions of the future, including the premonition of his impending early death, he declared the necessity for swift construction of a temple and stupa complex symbolic of the mystical land where the Kalachakra had once been secretly preserved: Shambhala.

From Shambhala Rising:

But what is Shambhala? And why has it so ignited the Mongolian spiritual imagination in general and that of the Gobi people in particular?

The Kalachakra Tantra (Tantra of the Wheel of Time), and its commentary the Vimalaprabha (Stainless Ornament), tell that Shakyamuni Buddha bestowed the teaching it contains, as one of his final acts, to King Suchandra. The king had journeyed for that purpose to the Dhanyakataka Stupa in India from a faraway land called Shambhala. Returning to Shambhala's capital at Kalapa, Suchandra wrote down what he had been taught and propagated the teachings and practices among his people.

Many of the major religious traditions describe our current time as one of degeneration, when people's inclination towards virtue and compassion is weak, and selfishness and conflict are rife. By contrast, Shambhala is portrayed as a sumptuous land where enlightened kings rule over prosperous subjects brimming with health who are well on their way to enlightenment themselves. The descriptions of such a place would understandably be tantalizing to Buddhist seekers in this age. This has been true since the Kalachakratantra entered our world sometime in the 10th or 11th c., an era when Muslim armies from the north were well on their way to obliterating Buddhism in the land of its birth.

The next natural question is: where is Shambhala? Is it somewhere on this Earth? That puzzle has proved even more vexing over the centuries. There are several extant texts purporting to be guidebooks to Shambhala. Their directions, however, are full of place names lost to antiquity, shrouded in mystical language, and describe numbers of fantastic beings both friendly and hostile. They also demand of the one who embarks on the journey such a high level of yogic accomplishment and knowledge that not only would most people be foolhardy to attempt the journey, but the overwhelming likelihood is that Shambhala exists on a much subtler plane than the world most of us know. Since the Kalachakra's transmission began among the Mongols in the 17th c., though, they have strongly suspected that the directions' northward indicators establish Mongolia as a strong candidate for the location of Shambhala's ancient physical existence and ongoing spiritual resonance.

Among Central Asian Buddhist lamas there is little dispute about the contemporary reality of Shambhala, however rarefied it may be. The prophetic elements in the Kalachakra literature detail the names and length of reigns of the Shambhala kings, with special focus on the 25th Rigden King, Rudrachakrin. The texts predict a time in the not-too-distant future (estimates range from quite near to about 400 years) when the whole world will be overwhelmed with pervasive suffering. Nations will steadily be absorbed through relentless war waged by those of barbaric ways and beliefs. Buddhist practice will wane until it barely exists except in obscure lands like Shambhala. It's said that the female Buddha, Arya Tara, will skillfully emanate to become the barbarian ruler's queen. At just the time when that ruler feels he has achieved supreme dominion in this world, his queen will reveal the hitherto unknown existence of Shambhala in all its incomparable magnificence. Bursting with envy and rage, the barbarian ruler will loose his armies at Shambhala, at which point Rudrachakrin will counter-attack, leading his own legions of Shambhala warriors in an epic battle which will utterly crush the barbarian forces. The victory of the Shambhala armies will usher in a golden age of Shambhala on Earth. This age will provide people with an excellent, but final opportunity to gain release in supreme enlightenment from their suffering round of rebirths before an 1800-year decline culminates in a world-ending cataclysm. Danzan Ravjaa's specifically directed his Gobi activity toward this aspect of the Kalachakra's predictions.

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