This paper analyses the “Impact of Fluctuations in Exchange Rate on Sensex.” The scope of the study has been restricted to India only. The exchange rates used for the study are of Re/$. The issue of whether stock prices and trade rates are connected or not has gotten significant consideration. On the off chance that stock prices and trade rates are connected and the causation keeps running from trade rates to stock prices, at that point, the emergency in the securities exchanges can be counteracted by controlling the trade rates. In addition, creating nations can endeavor such a connection to pull in/invigorate outside portfolio interest in their very own nations. So also, in the event that the causation keeps running from stock prices to trade rates, at that point experts can concentrate on Local financial arrangements to balance out the securities exchange. On the off chance that the two markets/costs are connected then, financial specialists can utilize this data to anticipate the conduct of one market utilizing the data on other markets.