Wooden and Metal Handicrafts. There are many metalworking shops near the Durbar Square.
Traditional Paintings Thanka
Books. Pilgrims Books on the right-hand side of Sahid Sukra Marg as it climbs the hill after crossing the Bagmati river opposite the Himalaya Hotel has an amazing selection of books on Nepal and Kathmandu, on Buddhism, Hinduism and many other religions, as well as a good selection of novels in English. Several small rooms of souvenirs too. Search out the oddities, such as a Kama Sutra colouring book, strangely sold next to children's colouring books!
Books. Saraswati, further up the road from Pilgrims, has more academic books. Ekta, turn left in Jawalakhel chowk, has academic text books, and a good selection of novels.
Quixote's Cove: the bookshop
Jawalakhel, tel: 553-6974 (http://www.qcbookshop.com). located next to new orleans cafe in jawalakhel, this bookshop is housed in an old 1930s building and combines a great collection of fiction with a marvelously cosy environment.