Gyalthang, A Tibetan Old Town

In the Tang Dynasty (8th century),
 Tubo Kingdom (Tibetan area)
controlled Zhongdian; and a town
 named Dukezhong was established.
“Du Ke” in Tibetan means “white”
 and typically refers to the moon
 or moonlight; “Zong” refers to
 a castle or village. Thus “Du Ke
 Zong” together means a moonlight
town. When it came to the Ming Dynasty,
 Mu power in Lijiang ruled over
Zhongdian, restored the ruined
“Du Ke Zong” and renamed it
 “Xiang Ge Wa Zhai” which means
“a white stony city” similar to
“Du Ke Zong”. Simultaneously,
 another town-“Da Nian Yu Wa Zhai”
-was constructed on the northern
 bank of Naizihe River (Milk River)
 of Zhongdian (Shangri-la), the
local Tibetans used to call it
“Ni Wang Zong”-a town of sun
 in Tibetan. Therefore, Xanggewazhai and Niwangzong towns together
 were abbreviated as “Xang Ge Ni Wang” to cover Zhongdian area.
 It's very close to “Xiang Ge Li La or Shangri-la. Situated on the
 plateau, 3,300 meters above the sea level, Zhongdian is full of
sunshine for most time of the year; the moon further adds to the
 glamour of the nights of in Zhongdian. Zhongdain deserves to be
called Shangri-la whose Tibetan meaning is “the Sun and the Moon
 in Mind”. In his novel the Lost Horizon, British writer James
Hilton mentioned a fairyland called Shangri-la for the first time.
 “Shangri-la” in the novel has been recognized as Zhongdian in
Northwest Yunnan. (Picture: the Biggest Praying Wheel in the World
 on Daguishan Hill)

However, the earliest name of Shangri-la is Gyalthang, a place
inhabited by Jieqiang People who were believed to be a branch of
the ancient Qiang Tribe. In the Ming Dynasty, Mu power bestowed
it a Naxi name-“Zhu Dun” which means “a castle for chieftain”
 and a Chinese name-“忠甸(zhōnɡ diàn)” that refers to a place
 where people  show loyalty to the Ming Court (忠，Zhong means
loyalty). But when the Qing overthrew the Ming, the Chinese spelling
 of “忠甸(zhōnɡ diàn)” was modified to “中甸”（also pronounces
as “zhōnɡ diàn” though it no longer means loyalty to the Ming Court).
 In 2001, “Zhong Dian” was renamed Shangri-la County officially.
 But Gyalthang and Dukezong remain as the same and are actually the
old town tourists usually visit.

Small as it is, the Old Town of Gyalthang is quite different form
others in Yunnan. The town brims over with Tibetan cultural facts
 such as Buddhist paintings and Tibetan residences side by side.
 A cobble path, not so crowded as Lijiang, will guide you to the
Daguishan Hill where you can turn the biggest praying wheel in
the world and take a birds-eye view of Shangri-la.