Balinese Hinduism rests upon an older animistic foundation, into which Hindu and Buddhist elements have been carefully woven. Indigenous belief sees the world as alive with spirits: ancestors, nature beings, and local deities inhabiting mountains, trees, rivers, stones, and crossroads. This vision remains visible in the daily rhythm of offerings placed not only in temples but also at house shrines, rice fields, and village boundaries, all meant to maintain harmony with unseen forces. Ancestral veneration continues through family and clan temples where the dead are honored and understood as powerful presences in the life of the community. The worship of bhuta kala and other unseen forces, along with rituals to avert disorder and impurity, shows how pre-Hindu ideas of spiritual danger and protection were not discarded but reinterpreted within a broader Hindu framework. Sacred geography—especially the reverence for mountains such as Mount Agung and for springs and lakes—likewise reflects an animistic sense of place that has been integrated into temple placement and ritual life.

Buddhism entered this already vibrant religious landscape and became intertwined with existing Hindu and indigenous forms rather than replacing them. Historical coexistence of Śaiva Hinduism and Mahayana (and related) Buddhist traditions led to a shared religious culture in which Buddhist deities such as Buddhas and Bodhisattvas could be honored within Hindu temple complexes and understood as related to, or manifestations of, Hindu gods. Buddhist philosophical ideas—karma, rebirth, the pursuit of liberation, and more subtle notions such as non-duality and emptiness—were absorbed into Balinese theological texts and ethical teachings, shaping how duty, conduct, and spiritual progress are understood. Ethical formulations like the emphasis on purity of thought, speech, and action, as well as certain meditation and ritual practices, bear the imprint of Buddhist influence while being fully accepted as part of Hindu dharma in Bali. Even the priestly class reflects this synthesis, drawing on both Hindu and Buddhist liturgical and contemplative traditions.

The result is a layered religious world in which animistic spirit-veneration, Hindu ritual and cosmology, and Buddhist metaphysics coexist in a single, coherent system. At one level, everyday practice centers on offerings, propitiation of local spirits, and care for ancestral and territorial powers; at another, the same practitioners move within a universe governed by karma, rebirth, and the possibility of spiritual liberation articulated in Hindu–Buddhist terms. Temple architecture and sacred layouts echo both the animistic sense of a spirit-filled landscape and the mandala-like vision of a structured cosmos. Rather than a simple borrowing from outside, Balinese Hinduism shows how older animistic intuitions about a living, sacred world could embrace Hindu gods and Buddhist wisdom, creating a tradition that is at once deeply local and philosophically rich.