Gurung was born on March 31, 1979, in Singapore to Nepali parents and raised in Kathmandu, Nepal. Family members as mentioned by Prabal in his social media and interviews include his mother, older brother and older sister. His mother, Durga Rana, was a former boutique owner. His older brother, Pravesh Rana Gurung, is an Indian film director, and his older sister, Kumudini Shrestha, is a teacher and social worker.
He went to a Jesuit school, St. Xavier's School in Jawalakhel. Before entering the fashion world, he earned a bachelor's degree in hotel management from the National Council of Hotel Management, Catering Technology and Applied Nutrition. He had always been interested in clothing and colors and was introduced to the world of fashion when he moved to one of the biggest cities in India, New Delhi. There, he attended the National Institute of Fashion Technology.
He held apprenticeships at many local fashion and production houses and worked under Manish Arora, during which time he was able to grow as a designer. Gurung has stated, “From the brilliance of Bollywood to the fabrics, embroideries, and textures you can find at Chandni Chowk to the fast-paced streets of Mumbai, it’s an incredible place.” Eventually, he received an opportunity to assist stylists in London and Melbourne during fashion shows for international print media. This opened up more doors for Gurung to expand beyond Asia and make his mark around the world.[citation needed]

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