It is said that Mahabrahma Devaraja, king of the Eighteen Heavens, wanted all people to receive benefit from the Buddha's sermons, so he asked the Buddha to give a sermon and he also presented him a golden fragrant flower. The Buddha sat down and held the flower out to the whole audience without saying a word. Everyone was puzzled at his behavior, wondering what he was up to—everyone except Kasyapa, who smiled. Amongst all the people there, Kasyapa was the only one who fully understood the Buddha's wordless lecture-everything in the universe, including that golden fragrant folower, was supposed to contain the Buddha's teaching of goodness, beauty and truth. The Buddha saw this and announced happily, "I have found the Right Path to activating the intrinsic buddha-nature hidden in people's minds. I am now formally passing the Right Path, which is actually formless but contains the significant essence of my teachings, to Kasyapa."

The Buddha also gave Kasyapa his own robe and bowl, which symbolized the passing down of his lineage, authority and responsibility. Because of the Zen nature of prompt enlightenment in this story, Kasyapa was known as the first partrich of the Zen sect in India. Both the robe and bowl have been handed down to each patriarch. This is the legend of "Passing Down the Robe and Bowl," often told in the Zen sect.

When the Buddha passed away, Kasyapa was not present. He was leading a group of disciples and preaching somewhere else. When they heard that the Buddha had passed away, they rushed back to attend his funeral. While some monks were crying because of his death, Upananda, one of the six ill-behaved disciples, seemed to be rather happy. "Why are you crying?" he asked them."You should be happy! When the Buddha was around, he always nagged us and told us that we couldn't do this and we couldn't do that. Now he's dead and we are free from his restrains. We should be happy!"

Kasyapa was quite upset to hear this, because he feared that any monk like Upananda could become a major source of trouble for the sangha in the future. He felt that the most important thing after the funeral was to compile the Buddha's lectures and precepts so that every monk could have something to follow and rely on to keep from going astray.

After the funeral, Kasyapa organized the first gathering of all the arhats to recite and confirm all the scriptures and the precepts. Ananda repeated all the lectures and Upali repeated all the precepts. Later in his life, Kasyapa realized that he was old and he needed to wait for Maitreya Buddha to arrive so that he could hand over Sakyamuni Buddha's robe and bowl to him. Therefore, he instructed Anada to be the leader of the sangha. Kasyapa went to Chicken Foot Mountain and entered a long meditation, waiting for Maitreya Bodhisattva to come down and become the next buddha. When King Ajatasatru heard that Kasyapa had gone to the mountain, he was very upset and came to the mountain in the hope of taking a last look at Kasyapa. The mountain suddenly split open like a lotus flower. The king saw Kasyapa sitting in meditation among the rocks, covered with mandara flowers (which grew on one of five trees in Paradise). Kasyapa looked very dignified. The king prostrated himself, and the mountain closed up again. Kasyapa is still there, waiting for the arrival of the next buddha on earth.