The form of Lord Narasimha was in response to the strange boon that was safeguarding the demon till that time. It featured the combination of a man and animal ultimately killing the demon on the laps (neither on the earth nor in the sky) and with the nails (not with any weapons) during the evening time (neither in the daylight nor under darkness).
Once Lord Narasimha tore away the demon into pieces, his rage and temper would not subside. He was moving everywhere with red eyes and a terrible form. He was assuming different forms like that of Kandaberunda, a very rare two headed bird incarnation. The three worlds trembled in fear. Under the leadership of Brahma all the gods approached Lord Shiva, the supreme godhead and prayed him to intervene in the scene.
Lord Shiva first sent his lieutenant Veerabadhra to pacify Lord Narasimha, which went in vain. Veerabadhra could do little even to approach Narasimha. Therefore, he came back and prayed Lord Shiva to do something personally.
The reference to what Lord Shiva did to counteract the anger of Narasimha is mentioned in the Sarabha Upanishad of Atharva Veda. The most powerful Lord Maheshwara assumed the form of Sarabeshwara, a combination of a man, eagle and lion emerged to put an end to the havoc created by Narasimha. This was in fact one of the divine sports of the two gods who were but one and the same, but engaged in different divine tasks.
Sarabeshwara, the rare combination of sarabha (bird) and yaali (animal) was thus the thirtieth manifestation of Lord Shiva among the sixty four incarnations he took in total. Sarabeshwara sported two massive wings that represented Pratyankira Devi and Soolini. He had eight legs, the nose of an eagle, four arms holding fire, deer, ankus and serpent and sharp nails like the thunderbolt.
The fierce and terrible Sarabeshwara came flying in the cosmos and landed near Narasimha. He used his two wings to comfort and cool him down. But all the fire and anger contained in Lord Narasimha manifestation took the form of Kandaberunda bird and started warring with Shiva himself. This divine war continued for eighteen days.
When Sarabeshwara wanted to put an end to the sport, he released Pratyinkira Devi from one of his wings. She just devoured the kandaberunda bird. Upon this, Narasimha realized his erroneous action and pleaded for pardon. Lord Shiva was highly pleased and comforted Lord Narasimha.
Narasimha and Brahma praised Sarabeshwara in several terms which became holy chants. Lord Sarabeshwara then declared that he manifested only to appease the anger of Narasimha and that the two gods are but one and the same like water and water, ghee and ghee and milk and milk. They are just inseparable and to be worshipped together.