The concept of cultural hybridity has emerged as an important framework for understanding identity formation in postcolonial and diasporic literature. In the context of Indian literary narratives, hybridity reflects the interaction between diverse cultural traditions, colonial histories, and modern global influences. Indian literature in English often portrays characters negotiating multiple identities shaped by history, migration, and social transformation. This research paper examines how cultural hybridity contributes to identity formation in selected Indian literary narratives. The study focuses on the works of prominent writers such as Salman Rushdie, Jhumpa Lahiri, Amitav Ghosh, and Arundhati Roy, whose writings explore the complex interactions between tradition and modernity, homeland and diaspora, and personal and cultural identities. Through an analysis of narratives such as Midnight's Children, The Namesake, The Shadow Lines, and The God of Small Things, this paper explores how characters navigate hybrid cultural spaces and construct identities that challenge rigid notions of nationality, ethnicity, and tradition. The study argues that cultural hybridity functions as both a source of conflict and a creative space for identity negotiation. Indian literary narratives reveal that identity is not a fixed or singular entity but an evolving process shaped by historical experiences, social interactions, and cultural exchanges. By examining these literary representations, the paper highlights the significance of hybridity as a central theme in contemporary Indian literature and its role in reflecting the complexities of postcolonial and globalized identities.