Understand
The Tibetan Buddhist roots of Dharamsala stretch back to the 8th century, although most of the local population long since reverted to and remains Hindu. "Dharamsala" literally means an "inn attached to a temple", and it was so until the district headquarters in Kangra became too crowded and the British moved 2 of their regiments in the late 1840s to what is now Dharamsala. Over the years, this grew to be district headquarters of Kangra, and the very location is now known as the Police Lines.
Dharamsala was mooted to be the summer capital of India. But this was not to be, as much of the town was destroyed in the 7.8 magnitude earthquake of 4th April 1905. The disaster killed over 10,000 people in this sparsely populated area.
After falling into obscurity in the early days of Indian independence, Dharamsala regained some social standing in 1959 with the arrival of the Dalai Lama and the Tibetan Government in Exile (http://www.tibet.com). Currently, it is a very popular hang-out for foreigners and students of Buddhism. Indeed, it is now perhaps a little too popular and many would say the town, and especially McLeod Ganj, is little more than a backpacker ghetto. Don't come here expecting calm and tranquility.
Climate
Lower Dharamsala is at an altitude of 1,400 m, while McLeod Ganj is at around 1,750 m, making them considerably cooler than the plains below. Temperatures in January can dip below freezing, while June can go up to 38°C. The monsoon season from July to September is very wet. Even in March, when the Dalai Lama holds his teachings and the weather down in Delhi is downright balmy, you will still need a heavy winter coat. These can be purchased at reasonable prices in the town.