Abstract: This paper explores the benefits and adverse effects of tourism on the psycho-social and economic life of the locals in the coastal village of Cavelossim, Goa (India). In the study a sample comprising 232 household heads were interviewed. Using Chi-square and Kruskal-Wallis H test, it was found that all household heads perceived that tourism had negatively impacted the psycho-social life of the locals. While the major economic benefits of tourism perceived were employment and increased income, the major adverse effect was increase in food prices. It was also found that due to tourism traditional occupations were abandoned for more lucrative employment.