United Kingdom and Nepal formally sign an agreement of friendship, called the Nepal–Britain Treaty of 1923, which superseded the Treaty of Sugauli signed in 1816.

Nepal, officially the Federal Democratic Republic of Nepal, is a landlocked country in South Asia. It is mainly situated in the Himalayas, but also includes parts of the Indo-Gangetic Plain. It borders the Tibet Autonomous Region of China to the north, and India to the south, east, and west, while it is narrowly separated from Bangladesh by the Siliguri Corridor, and from Bhutan by the Indian state of Sikkim. Nepal has a diverse geography, including fertile plains, subalpine forested hills, and eight of the world's ten tallest mountains, including Mount Everest, the highest point on Earth. Kathmandu is the nation's capital and its largest city. Nepal is a multi-ethnic, multi-lingual, multi-religious, and multi-cultural state, with Nepali as the official language.

The Nepal–Britain Treaty was first discussed in 1921 and the final treaty was signed on 21 December 1923 in Singha Durbar. The treaty was the first formal acknowledgement by the British that Nepal, as an independent nation, had the right to conduct its foreign policy in any way it saw fit and was considered to be “a great achievement of 25 years of Chandra Shumsher’s diplomacy.” The treaty was recorded in 1925 in the League of Nations.

The Treaty of Sugauli, the treaty that established the boundary line of Nepal, was signed on 4 March 1816 between the East India Company and Guru Gajraj Mishra following the Anglo-Nepalese War of 1814–16.