In this work, we have established the evaporation-liquid flow coupling mechanism by which sessile nanofluid droplets on a hydrophobic substrate evaporate and agglomerate to form unique morphological features under controlled external heating. It is well understood that evaporation coupled with internal liquid flow controls particle transport in a spatiotemporal sense. Flow characteristics inside the heated droplet are investigated and found to be driven by the buoyancy effects. Velocity magnitudes are observed to increase by an order at higher temperatures with similar looking flow profiles. The recirculating flow induced particle transport coupled with collision of particles and shear interaction between them leads to the formation of dome shaped viscoelastic shells of different dimensions depending on the surface temperature. These shells undergo sol-gel transition and subsequently undergo buckling instability leading to the formation of daughter cavities. With an increase in the surface temperature, droplets exhibit buckling from multiple sites over a larger sector in the top half of the droplet. Irrespective of the initial nanoparticle concentration and substrate temperature, growth of a daughter cavity (subsequent to buckling) inside the droplet is found to be controlled by the solvent evaporation rate from the droplet periphery and is shown to exhibit a universal trend. © 2016 American Physical Society.