Avalokiteshvara is a regular seen Bodhisattva in the various Monestries in the Kathmandu Valley.

The current 14th Dalai Lama, the leader of the Yellow hat sect of Tibetan Budhism is believed to be an incarnation of Avalokiteshvara who has many arms to help as many people as possible.
Avalokitesvara is created by Amitabha the "supreme" Buddha out of compassion with humans who suffer. Orginally Avalokitesvara tried to save souls from suffering in Hell, but for every soul that Avalokiteshvara saved from suffering two new souls arrived in Hell. Knowing that he could never completed his mission of saving all humans from suffering Avalokiteshvara scattered into pieces.
Amitabha saw all this and re-created Avalokiteshvara but this time with one thousend hands and in each hand an all seeing eyes. From the rest of the pieces Amitabha created 11 heads for Avalokiteshvara so he could look in all the direcetions plus past, future and present.
Even with his 11 heads and thousand hand Avalokiteshvara wasn't able to save all souls. This made him very sad and from the tears he wept the Green and White Tara were born. The green and white Tara are also there to help human kind ending their sufferings.
You can find this story depicted in some of the Thanka's that are for sale in Kathmandu and other places of the Kathmandu Valley.

Avalokiteshvara is widely worshiped in Asia under different forms and names. In Japan she became Kannon and the chinese godess Kuan-Yin has her origin in Avalokiteshvara too.

Sources

Born in Nepal - Susan Höivik