Retail Sector is a very large sector in India. It has occupied an important role all over the country. No place in India is found without Retail trade. Its importance has been increasing day by day due to its advantages like requirement of very limited capital, limited manpower, limited space and less legal formalities. Even a single person with limited resources can also start this business. As we know that India is a second most populated country in the world just after China. Poverty and unemployment are major problems in our country. These two problems are root cause and also remedy of each other. If one problem is solved other will be solved automatically. In this way we can say that employment help us in reducing poverty and other related problems like robbery, loot, crimes, Dacoit etc. Retail Sector is one of the easiest, oldest, and cheaper ways of employment among the youth in country. The study comprises need and challenges of retail sector in Indian economy and also to provide recommendation and solution for the problems faced by Indian retail sector