More than 90 percent of the film had visually enhanced shots and according to the producer, more than 600 VFX artists worked for the film from 18 facilities around the world led by Makuta VFX and Firefly in Hyderabad, Prasad Studios in Hyderabad and Chennai, Annapurna Studios in Hyderabad, Tau Films in Malaysia, and Dancing Digital Animation and Macrograph in South Korea. Vijayendra Prasad who wrote stories for most of Rajamouli's films once again penned the story for Baahubali. The film boasts of one year pre production work where in 15,000-story board sketches for the film were created which is highest for any Indian Film till date. The waterfall scenes in the film were shot at Athirappilly Falls in Kerala, huge sets for the Mahishmati kingdom were constructed at Ramoji Film City in Hyderabad and the snow episodes in the film were shot in Bulgaria.

In January 2013, he announced that the working title as Baahubali and the actual film production started at Rock Gardens in Kurnool on 6 July 2013. Rajamouli announced that Prabhas will star in his upcoming movie. He had further revealed that the core storyline – where one brother is not given the throne because of his disability leading to animosity between blood relatives – was also partly inspired by this movie. Rajamouli and the storywriter of Baahubali: The Beginning had revealed that he was inspired by the hero introduction sequence of the 1967 Kannnada film, Immadi Pulikeshi, based on the life of the Chalukya king, Pulakeshin II and hence incorporated a similar sequence. While Amarendra was gracious and loved his countrymen, Bhallaladeva was violent and achieved his goals by any means possible. Both young men were trained in arts, science, disguise, politics, and warfare, but they had different approaches towards kingship. Amarendra was brought up together with Bijjaladeva and Sivagami's son Bhallaladeva. Bijjaladeva's wife Sivagami assumed control of the kingdom with Kattappa's assistance until a new king could be selected.

His uncle Bijjaladeva ( Nassar) was deemed unfit to rule due to his crooked nature, however he believes he was denied the throne due to the fact that one of his arms is disabled. Amarendra's father had died long ago, while his mother died giving birth to him. He narrates the story of Amarendra's past. After Shivudu beheads Bhadrudu, Kattappa drops his weapon, realising that Shivudu is Mahendra Baahubali, the son of late king Amarendra Baahubali.

Sivudu manages to flee with Devasena, but is chased down by Bhallaladeva's son, Bhadrudu ( Adivi Sesh) and the slave-soldier Kattappa ( Sathyaraj).

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