Here's a blurb from allmusic:
The word "Shambala" is derived from the Buddhist "Shambhala," which is a revelation or a goal of the teachings to acknowledge humanity's desire and aspirations to create a society that will enable the inhabitants to "express the dignity of human existence and to lead meaningful lives within a flourishing culture," according to the Shambhala Meditation Centers. Much of that attitude is reflected in the pastoral and amiable "Everyone is helpful, everyone is kind/On the road to Shambala/Everyone is lucky, everyone is kind/On the road to Shambala." Daniel Moore's lyrics also carry a bit of psychedelic imagery in the lines "I can tell my sister [brother] by the flowers in her [his] eyes/On the road to Shambala." There is a definite spiritual quality suggesting an awakening or pilgrimage during the prominent chorus "How does your light shine/On the road to Shambala," suggesting the rhetorical inquiry, "Is one's life in order?" Likewise, the three-part vocal harmonies relate a gospel flavor, especially on the closing repetitive chorus. The tune was extracted as a single from 1973's "Cyan" album and did exceptionally well, peaking at number three in June of that year. Hardcore Three Dog Night enthusiasts should note an extended and significantly remixed version of "Shambala" was included on the original motion picture soundtrack to the film Drowning Mona (1990). Other artists to have recorded the title are B.W. Stevenson, Rockapella, New Seekers, and Solomon Burke. It has also appeared on a recent episode of "Lost".