[citation needed] The town of Nyamati was established in the late 18th-century, during the tenure of Purnaiah as Dewan of Mysore.

Situated between the hilly terrain and the plains, trade involving products of the two regions was carried out in the town.

The grain of the Malenadu and jaggery of the neighbouring taluks could be stored in the town's dry climate for some time without risk of damage.

Arecanut from Nagara and Koppa were forwarded to Bellary and Dharwad in return for cloths and other articles, which were sent to the Malenadu and the coastal region.

[2] Nyamati is famous in vegetable production (green chili)[citation needed] and also for areca sales from Malnad areas.