The 1857 Indian War of Independence stirred the hearts of the Kasauli Guard, numbering about eighty Indian soldiers. Receiving news that the Gurkha Regiment at nearby Jutogh has also risen in revolt, the garrison at Kasauli set out to join them. Before the two could combine and pose a serious threat, the British agent talked the Gurkha Regiment into submission, on promise of a general pardon. The Kasauli Guard found themselves completely isolated. So far from being pardoned, they were severely punished for their insurgence.
Kasauli played a very important role in the sepoy mutiny of 1857. During the uprising of 1857, on April 17 soldiers at Ambala cantonment were forced to use greased cartridges. On May 15 the forces stationed at Jatog revolted and refused to obey the orders of their officers. At Kasauli the government wanted to shift the treasury to the European barracks. The Gorkhas got annoyed and looted the treasury and moved to Jatog and set fire to some of the tents of the Commander-in-Chief.