Studies on negation in the school of Vyākaraṇa have focused on the early period of its development, especially on the interpretation of prasajya and paryudāsa types of negation provided by early commentators starting with Patañjali and elaborated on by Bhartṛhari. The post-Bhartṛhari period requires thorough research when it comes to the theory of meaning and cognition proposed by Indian grammarians. The present article analyses the interpretation of negation proposed by Kauṇḍabhaṭṭa in the Vaiyākaraṇabhūṣaṇasāra and shows it against the background of theory of negation that had been developing for centuries within the school of Vyākaraṇa.