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This gesture predates Buddhism, having been used for long by Hindu yogis to develop powers of concentration and healing.
In this mudra, the seated Buddha is seen with hands placed on his lap, right hand over left, palms facing upward and fingers stretched in a relaxed pose. The right hand represents enlightenment, while the left is the illusory nature of existence. Alternatively, this positioning of the hands signifies skilful action (or “method”) as arising from a state of inner calm.
Sometimes, this mudra is displayed with both thumb tips touching each other, forming a triangle. This figure represents the Three Jewels of Buddhism – the Buddha, the Sangha and the Good Law (Dharma). The coming together of the thumb tips also indicates the union of two psychic channels in the body, as represented by the male and female principles that exist in every sentient being.
Dhyana mudra is said to have been practiced by Sakyamuni as he meditated under the pipal tree before attaining enlightenment. It is typically seen in icons of the primeval Adi-Buddha, Samantabhadra and Amitabha Buddha.
On a more practical note, the Mudra signifies the gesture of absolute balance. The person meditating is completely unmoved by the surroundings, immersed in infinite space.