According to Monier Williams, the term is found in many Vedic texts, in the context of "a fee or present to the officiating priest (consisting originally of a cow, K?ty?yana ?rautas?tra 15, L??y?yana ?rautas?tra 8.1.2)", a "donation to the priest", a "reward", an "offering to a guru", a "gift, donation".

The word also connotes "south", a cardinal direction. Dakshina is also found in various other expressions such as 'dakshinachara', right-hand path of tantra. The neuter noun dakshinam means 'the Deccan', a transformation of dakshinam as the language evolved.

Gurudakshina refers to the tradition of repaying one's teacher or guru after a period of study or the completion of formal education, or to spiritual guide.^[6] This tradition is one of acknowledgment, respect, and thanks.^[7] It is a form of reciprocity and exchange between student and teacher. The repayment is not exclusively monetary and may be a special task the teacher wants the student to accomplish.

There is a symbolic story in the Indian epic Mahabharata that discusses proper and improper gurudakshina, after a character named Ekalavya.^[8] This story refers to a tribal boy's passion to learn and master archery.

The story, like many stories in Mahabharata is an open ended parable on education, personal drive to learn, and what is proper and improper dakshina? In the epic Mahabharata, after the right hand thumb as gurudakshina event, Drona is haunted and wonders if demanding Ekalavya's thumb was proper,^[9] Ekalavya goes on to re-master archery with four fingers of his right hand, as well as left hand, thereby becoming a mighty warrior, becomes accepted as a king, and tells his children that education is for everyone and that no one can close the doors of education on any human being.^[10][11]

• Guru-shishya tradition