The Varathamanadhi Dam is constructed across Varathamanathi river in Ayakudi village of Palani Taluk in Dindigul District. It originates from Western Ghats adjoining to Kodaikanal hills. It is originating from Vadakavunji and Perumal malai valleys and this river confluences with Shunmuganadhi.
By this reservoir Dindigul District is benefitted. Palani taluk is benefitted by this reservoir.
The construction of Varathamanadhi dam was started during 1974 and completed during 1978.