There was a king of the daityas named Bali. He was powerful and invincible. He was also righteous and truthful. The gods cold not bear to see Bali‘s prosperity and began to plot how Bali might be foiled. So well did Bali rule that disease, drought and evil disappeared throughout the three worlds.
In desperation, the gods approached Vishnu. “Please do something about Bali”, they requested. “You always help us out when we are in trouble”.
“There is no difference between Bali and the gods so far as I am concerned,” replied Vishnu “Bali is devoted to me. I cannot therefore fight with him. But I will think of a way so that his kingdom might be taken away from him and given to you.”
Bali proposed to organise a horse sacrifice. Many sages came to the sacrifice and Shukracharya was the chief priest. The dwarf also arrived to witness the yajna.
Shukracharya realised that the dwarf was none other than Vishnu. He told Bali, “I suspect that this dwarf is Vishnu in disguise. He must have come here to ask you for something. Please do not grant him anything without first consulting me.”
“Certainly not,” replied Bali. “It is good fortune indeed that the great Vishnu has come to my house. What is there to consult about? I shall grant Vishnu whatever he wants.”
Bali went to the dwarf to ascertain what the dwarf wanted. Vishnu expressed the wish that he might be given as much of land as might be covered in three of the dwarf’s steps. This boon Bali readily granted. But no sooner than the boon had been granted, the dwarf adopted a gigantic form. He placed one foot on Bali’s yajna and the second on Brahmaloka.
“Where will I place my third step?” demanded Vishnu. There is no more space left in the entire universe. Find me a place for my third step.”
Bali smiled and said, “Place it on my back.”
Vishnu was charmed at Bali’s generosity. He granted Bali the boon that Bali would hold the title of Indra in a future manvantara. He then appointed Bali king of the underworld. But Indra’s kingdom of heaven, which Bali had conquered, was returned to Indra.
Brahma had all this while been in Brahmaloka. When Vishnu placed his second foot on Brahmaloka, Brahma felt that he should welcome his water-pot (kamandalu) to wash the foot. The water spilled over from the foot and fell on the mountains. There the water divided into four. Vishnu accepted the flow that went northwards. The flow that went westwards returned to Brahma’s kamandalu. The flow that went eastwards was gathered up by the gods and the sages. But the flow that went southwards got entangled in Shiva’s matted hair. This water was the river Ganga.