According to Puranas Prabhu Shiva has many sacred temples,sacred Lingas, Major 12 jyotirlingas, and Panchabhoota Lingas.
But “Gokarna” is special it is considered as Atmalingam of Prabhu Shiva.
It is one of the Panchalingams present in Karnataka others being Murudeshwara, Sajjeshwara, Dhareshwara, Gunavanteshwara.
The STORY :
Once Ravana tried to lift and take away Kailasha to Lanka but Prabhu Shiva has stopped his efforts by merely pressing his toe when Ravana was under the Mountain lifting the mountain,realising that Ravana prayed to Prabhu Shiva in immense pain and by seeing his devotion in that situation Prabhu Shiva saved him and asked for a boon Ravana asked Prabhu Shiva himself so Prabhu has given him his Aatma linga and said where ever it touches the land,the Aatma Linga will stay there…
But seeing this Devas prayed to Ganesh ji and Prabhu Vishnu so Vishnu ji covered sun with his sudarshana chakra and Making illusion of Sandhya and Ravana being a Brahmin never missed Sandhya vandan,at that time Ganesh ji took a form of boy seeing him Ravana handed him the lingam and went to Sandhya vandan but Ganesh ji kept condition that he will call him 3 times if he doesn't come then he will keep the Linga on the ground and he did it.
So yeah the place where thread tied to casket fell is Dhareshwara,the place where lid of casket fell is Gunavanteshwara,the place where casket fell is Sajjeshwara,the place where cloth on Aatma linga fell is Murudeshwara and the place where Prabhu Ganesha place Aatma linga is Mahabaleshwara.
(REFERENCE : Ramayana…)
The Mahabaleshwara temple becomes sacred because it is believed Prabhu Sri Krishna has took the bathing in kotiteertha and prayed to Gokarna before battle with Banasura and there is temple of Krishna “Shree Gopal Krishna temple” .
[ There is no major mentionings in purana's about this instead BalRama came here by avoiding Kurukshetra.]
I can't find solid reference but found this in Narara Purana “Radha Krishna sahasranama”.
I know it just says Krishna worships Prabhu Shiva But it doesn't mean he prayed to Shiva before battle of Bana,but at the same time here they used Gokarna instead of many other names and in sthala purana of Kotiteertha also have the story.
[ Note : sthala purana's can be wrong ].
All things aside this place is very Sacred.
Jai shree Ram π️ππ»
Hara HarΔ Mahadeva π️ ππ»