Bollywood is recognized as the largest film producing industry in the world. India produced a total of 2961 films including1602 feature films in 2012 alone. Movie tickets in India are among the cheapest in the world. The average ticket price in India is 25 rupees (55 cents) in comparison to the average ticket price in the US in 2010 that costs around $ 7.50 dollars. India accounts for 73% of Asia-Pacific movie admissions. Indian film industry generated total revenues worth around $1.86 billion (93 billion rupees) in 2011 only and it is estimated to rise to the US$2.28 billion (138 billion rupees) by 2014. The industry is mainly supported by the vast cinema-going Indian public. According to an estimate, approximately fourteen million Indians visit cinemas daily to watch a film on regular basis. In 2012 alone, Bollywood sold around 2.6 billion tickets compared to Hollywood’s 1.36 billion tickets. Indian films are gaining increasing popularity around the world, especially in countries with large numbers of emigrants. The aim of this research paper is to present an overview of the historical evolution of Indian Cinema since its inception. This qualitative historical analysis identifies the factors that lead to its phenomenal growth through all these years.