The origin of Pushkar and its fair is steeped in myth and legend. According to the Padma Purana -- one of the 18 stories on which much of popular Hinduism is based -- Brahma, the creator was looking for a suitable place to perform a yagna or a holy sacrifice on earth.
As he flew the heavenly skies and pondered, a lotus fell from his hand and struck the earth. Water issued forth and the spot turned into a lake. Brahma named the holy lake Pushkar and resolved to perform the sacrifice here.