At the east end of the square, the eye-catching Dattatreya Temple was originally built in 1427, supposedly using the timber from a single tree. The slightly mismatched front porch was added later. Undamaged by the 2015 earthquake, the temple is dedicated to Dattatreya, a curious hybrid deity, blending elements of Brahma, Vishnu and Shiva. Judging from the Garuda statue and the conch and chakra disc mounted on pillars supported by stone turtles in front of the temple, Vishnu seems to have come out on top.
The three-storey temple is raised above the ground on a brick and terracotta base, which is carved with erotic scenes, including unexpected humour where one bored-looking woman multitasks by washing her hair while being pleasured by her husband. The main steps to the temple are guarded by statues of the same two Malla wrestlers who watch over the first plinth of the Nyatapola Temple.