Laboratory physician's role by and large is confined to diagnostics and academics. Exposure on practical aspects is limited which is nevertheless essential. There is a significant gap in literature on how a four walled space is transformed into functioning laboratory.. We wish to narrate challenges and experiences faced during the process of setting up a diagnostic pathology laboratory attached to a teaching hospital in a rural geographic area. Bulk of data is the authors first-hand experience in setting up the laboratory from October 2019 to July 2021. For specifications and infrastructure related information, guidelines of national and international statutory governing bodies like National Medical Commission (NMC), National Board for Accreditation of Laboratories(NABL), Clinical and Laboratory Standards Institute(CLSI) were referred along with discussion from peers working in established laboratories. Various facets to make a laboratory fully functional were compiled and presented. A diagnostic pathology laboratory with basic subdivisions had been made functional to cater to healthcare needs of patients keeping in mind the scope for future expansion and growth. Basic fundamentals of infrastructure, manpower, consumables, vendor and data management are pertinent to even the laboratory associated medical professionals. An integrated and systematic approach with open mind for continual improvement is what it takes to face challenges and set up the diagnostics. A knowledge and hands on experience of various facets pertaining to a functional laboratory is essential to the practicing pathologists. This article provides the much-needed literature on challenges faced which can be a reference material for others undertaking a similar setting at work.