India enjoy a vast and versatile resource base in respect of her fisheries. However, the country presently has reached a crossroad so far as sustainable tapping of this resource base is concerned. By defining sustainability not merely as economic viability but also in terms of ecological and social compatibility, this paper looks into the problems and prospects of sustainable management of Indian Marine fisheries. It analyses the various types of negative externalities arising out of a lack of clearly defined 'property rights' regime, both from within and outside of this sector. A future policy perspective is developed through a critical examination of the Code of Conduct for Responsible Fisheries and the famous Supreme Court Judgement of December 1996 on coastal aquaculture, and then comparing the Common Fisheries Policy in respect of their capabilities in striking the necessary balance between economic needs and socio-ecological requirements. The paper highlights the need for evolving a network of 'brotherhood' type organisations institutionalized at local stakeholder's level.