<b>A Study on Effect of Demonetization on Indian Economy</b> Pulling back units of cash from dissemination is demonetization units of cash are denied the status of legitimate delicate. Demonetization is characterized as a procedure by which cash units won t stay lawful delicate. The money notes won t be taken as substantial cash. Demonetization is a step taken by the administration where money units are stopped of its status as legitimate delicate. Demonetization is an essential condition to change national money. As it were, demonetization can be said a difference in money where new units of cash supplant the old one. It might include the presentation of new notes or coins of a similar category or totally new division. The cash has been demonetized thrice in India. The principal demonetization was in 1946, second in 1978 and the third was on 8th November 2016 Tuesday . The investigation endeavors to get importance and reasons for demonetization, the segment insightful effect of demonetization. This examination likewise gives a knowledge into the positive and negative effect of demonetization on the Indian economy. This investigation is of graphic nature so all the required furthermore, significant information have been taken up from different diaries, magazines for distributed papers and sites. Books have likewise alluded for hypothetical data on the theme as required. Demonetization, economy, GDP 1063-1066 Issue-5 Volume-3 Prof. Babagouda. A. Patil