The Bhima River, which originates in Bhimashankar of the Western Ghats, and forms the Bhima Valley with its tributary rivers and streams, has twenty-two dams built on it of which the Ujjani Dam is the terminal dam on the river and is the largest in the valley that intercepts a catchment area of (which includes a free catchment of ). The construction of the dam project including the canal system on both banks was started in 1969 at an initial estimated cost of Rs 400 million and when completed in June 1980 the cost incurred was of the order of Rs 3295.85 million.