Manikaran town of Kullu district, Himachal Pradesh, NW Himalaya, India is a famous hotspot for hot springs, ancient Ram Mandir, and Gurudwara Sahib, which makes it a major tourist attraction. Over the past years, the number of tourists visiting Manikaran to explore the hot springs and ancient temples has increased exponentially. One major rockfall event occurred in Manikaran town in August 2015, destroying the four-story Gurudwara building, killing nearly 10 people, and injuring 15 people sleeping in the Gurudwara’s Sarai. Manikaran and surrounding areas witness rockfall activity every monsoon. These past events and the attraction of tourists to this place make it a very risky zone that needs to be studied closely. In this study, a holistic approach comprising geological field investigation, geomorphic mapping, field-based rockfall dataset (rock shape and volume), generation of high-resolution digital elevation model (DEM) using RTK-DGPS, and numerical modelling using open-source software SICONOS was conducted. During field investigations, it was found that the August 2015 rockfall event was not only a result of a single rock block affecting the Gurudwara. Instead, the main rockfall source block triggered the chain of rockfall events by remobilizing the static blocks present on the surface of the runout path of the moving block. A novel rockfall propagation model was developed by incorporating the rock-rock interaction using the rigid body approach in SICONOS software to complement the real August 2015 rockfall event in Manikaran. A comparative rockfall hazard assessment was conducted by comparing the rockfall trajectory simulation with and without static blocks present on the slope. Consequently, two different scenarios of rockfall simulations were generated for Manikaran such that realistic rockfall events can be captured for predicting future rockfall hazards in Manikaran. This study considers for the first time the role of static blocks present on the surface in rockfall propagation models and has potential applications across a wide range of rockfall-prone areas, especially those where large static rock blocks are found in the run-out path of moving rock blocks during rockfalls.