Located in Khalanga, the district headquarters of Darchula district (specifically in Galphai, Mahakali Municipality Ward No. 5), District Hospital Darchula has been operational since 1986 AD (2043 BS). It has been providing healthcare services to the citizens of all 9 local levels within the Darchula district.

Although the physical infrastructure of District Hospital Darchula was originally spread across an area of 37-11-0-1 Ropanis, a massive flood in the Mahakali River on June 16, 2013 AD (Asar 2, 2070 BS) swept away the hospital's land along with the buildings built upon it. Currently, the hospital is left with only 24-1-0-1 Ropanis of land (according to the Darchula Survey Office). Services are now being delivered from a few rooms of the dilapidated buildings that survived the flood, alongside some multi-room structures constructed through grants from the provincial government.

Since there is no public land available in the district headquarters area suitable for the hospital's needs, and because local residents of the current hospital area protest any attempts to relocate it elsewhere, there is no viable option left but to prepare a site-appropriate design and estimate to construct an additional 50-bed hospital building on the remaining land.

Although the hospital has an officially approved capacity of only 15 beds, it is currently operating with up to 50 beds due to the high volume of patients. The lack of physical infrastructure, combined with a shortage of doctors and healthcare workers, remains the primary challenge facing the hospital today. Because the hospital currently has a low number of sanctioned posts—some of which are also vacant—manpower is being hired on a service contract basis to sustain regular operations.

Following the country's transition to federalism, this hospital now operates under the Ministry of Social Development of the Sudurpashchim Province Government. Additionally, this hospital serves as the district-level referral center for health institutions located across the various rural municipalities and municipalities of Darchula district.