I wondered the same legend ... Let us discuss in this blog ..
For thousands of years, there was a rumor circulating, that somewhere in Tibet, between the snowy Himalayan peaks and remote valleys, there is an untouched paradise, a kingdom of peace that is not was indescribable. A kingdom called Shambhala. James Hilton wrote about this mystical city in 1933 in his book "Lost Horizon". Then picked it up in the Hollywood film production in 1960, "Shangri-la". Even the famous author who wrote the James Redfield The Celestine Prophecy also wrote a book entitled "The Secret of Shambhala: In Search of the Eleven Insight." 
Mysterious Shambhala is also regarded as a source for the Kalachakra, which is high and most esoteric branch of Tibetan mysticism .
We can find record of this kingdom in ancient texts such as the Kalachakra and Zhang Zhung that even existed before Buddhism entered Tibet.
Shambala

Shambhala is derived from Sanskrit, meaning "peaceful place" or "Place of silence". This kingdom has a capital named Kalapa and ruled by the kings of the dynasty Kulika or Kalki. This is where living things are perfect and semi-perfect meet and jointly guide the evolution of humanity. Only those who are pure in heart that can live in this place. There they will enjoy happiness and peace and will not even familiar with suffering.
Many adventurers and explorers have been trying to find this mystical kingdom. According to them, maybe Shambhala is located in mountainous regions of Eurasia, hidden from the outside world. And some who do not find it to believe that Shambhala is just a symbol, a liaison between the real world with the existing world beyond. But, some people longer believe that Shambhala is a real world. 
An ancient story of the Tibet tells us that one day there was a young man who prepares to search for Shambhala. After exploring the many mountains, he found a cave. 
Inside was an old hermit who then asked the young man: "Where are you willing to explore your destination so that the heavy snow this?"

"To find Shambhala," replied the young man.

"Ah, you do not need to go far." The word hermit. "Behold the kingdom of Shambhala is in your own heart."

Is there really a Shambhala in our hearts? I do not really know about this legend, but I want to find ... but unfortunately was in Tibet, not in Indonesia :D