The aim of the study is that to know the investor's perception of mutual funds. It aims at understanding the perception of the investors who invest in mutual funds as not everyone is familiar with mutual funds but still they invest in it to get returns. This study contains a sample of 140 different kinds of investors and their diversification of investment plans. The data was collected from the investors through circulated questionnaires in Hyderabad city and surrounded by rural and urban areas. By this study found that most of the investors have a positive impact and good knowledge of mutual funds. Based on the findings and analysis it concluded that most of the investors are satisfied with the returns and performance of mutual funds. Also found that tax benefits, diversification, and reduction in risk as more impact on the investor's perception of investing in mutual funds.