According to Kshetra Purana long long back all sages numbering to one crore, gathered in this place and did tapas for a long time to please Lord Shiva. Then Shiva appeared in front of each of them thus this place where Lord Shiva appeared in one crore form, became popular as Kotee-eshwar, but slowly got translated as Koteshwar.
It is said that the present temple was built by Pandavas, no doubt it looks that old and giant.
http://en.wikipedia.org/wiki/Koteshwara
Images
https://www.google.com/search?site=imghp&tbm=isch&source=hp&biw=1280&bih=643&q=Koteshwara
Tube
http://www.youtube.com/results?search_query=koteshwara+Shiva+karnataka
http://en.wikipedia.org/wiki/Koteshwara
Images
https://www.google.com/search?site=imghp&tbm=isch&source=hp&biw=1280&bih=643&q=Koteshwara
Tube
http://www.youtube.com/results?search_query=koteshwara+Shiva+karnataka
