Rhizomes of Cyperus rotundus Linn.(Cyperaceae), extensively used in Ayurveda by the name of “Mustaka” for the treatment of digestive disorders, bowel disorders and inflammatory diseases, have been focus drug for ancient as well as present day scholars of Ayurveda. It contains essential oils, terpenes, flavonoids, beta- itosterol and ascorbic acid. The main terpenes in C. rotundus are cyperenes, which include sesquiterpene hydrocarbons. Pharmacological studies have proved its efficacy as antiviral against hepatitis B virus, antimicrobial, antipyretic, anti-obesity and anti-allergic drug. This paper envisages evidence based information regarding classical therapeutic indications and pharmacological activities of this plant drug.