The classical financial theories have been the base of finance since the mid 18th century but in the past two and half decade there has been a paradigm shift in the field of financial from classical finance to a new field of finance named as Behavioral Finance. Behavioral Finance is an improvised form of standard finance models, concepts or theories by taking insights from sociology, neuroscience, law, psychology and organisation behaviour. This paper studies about the evolution of standard finance and behavioral finance and its present status in India.