Internal controls are defined as the plans of an organization, including management's attitude, methods, procedures, and measures that provide reasonable assurance that the objectives are being achieved. The study set out to investigate the role of internal control system in the performance of co-operative banks in India. Specifically, the study sought to establish the effect of control environment on the performance of co-operative banks. To achieve the objective of the study an empirical study has been applied. For the collection of data, a questionnaire has been designed and circulated among 217 respondents. The study found a significant relationship between control environment, control activities, monitoring, and performance of co-operative banks. The study recommended that control environment, control activities, and monitoring should be enhanced in order to further improve the performance of co-operative banks.