This paper explores the effectiveness of financial regulation in preventing crises in India, focusing on historical events that shaped the regulatory landscape and the ongoing challenges faced by regulatory bodies. Financial crises, such as the 1991 Balance of Payments crisis and the Non-Performing Assets (NPA) crisis in the banking sector, have highlighted vulnerabilities within the Indian financial system, prompting significant regulatory reforms aimed at enhancing stability and resilience. The analysis begins with the 1991 crisis, which led to the liberalization of the Indian economy and the establishment of key regulatory institutions like the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI). These reforms aimed to promote transparency, protect investors, and ensure sound risk management practices within financial institutions. The paper further examines the NPA crisis, which emerged from reckless lending practices and inadequate risk assessment, exposing deficiencies in governance and regulatory oversight.