The introduction of the Insolvency and Bankruptcy Code (IBC) in 2016 marked a pivotal moment in India’s legal and economic landscape, providing a unified and time-bound framework for insolvency resolution. Among the various mechanisms embedded within the IBC, the Pre-Packaged Insolvency Resolution Process (Pre-Packs) has emerged as a noteworthy innovation, particularly designed to address the insolvency challenges of Micro, Small, and Medium Enterprises (MSMEs). This research paper delves into the evolution of Pre-Packs under the IBC, tracing their legislative genesis, operational dynamics, and their broader implications for India’s insolvency regime. Pre-Packs, a hybrid insolvency resolution process, allow for the resolution plan to be negotiated and finalized between the debtor and creditors before formal court proceedings are initiated. This mechanism, which has been successfully implemented in jurisdictions like the United Kingdom and the United States, was introduced in India in 2021 to offer a more efficient and less disruptive alternative to the traditional Corporate Insolvency Resolution Process (CIRP). This study critically examines the introduction of Pre-Packs in India, their legislative foundation, and the early applications and outcomes within the Indian context. The paper further explores the operational mechanisms of Pre-Packs under the IBC, including the roles and responsibilities of stakeholders such as debtors, creditors, insolvency professionals, and the National Company Law Tribunal (NCLT). It highlights the key advantages of Pre-Packs, including expedited resolution, cost-effectiveness, and the preservation of business continuity, while also addressing the potential challenges, such as the risk of promoter misuse, transparency concerns, and the limited scope of application to MSMEs. By comparing the Indian Pre-Pack framework with international practices, the research identifies global best practices and discusses their applicability in the Indian context. The paper also emphasizes the need for policy reforms to expand the scope of Pre-Packs to larger enterprises, enhance regulatory safeguards, and strengthen the role of insolvency professionals to ensure the integrity and effectiveness of the process. In conclusion, this research underscores the significance of Pre-Packs as a progressive step in India’s insolvency framework. While acknowledging the challenges and limitations, the study argues that with appropriate reforms and enhancements, Pre-Packs have the potential to become a vital tool in the resolution of corporate distress in India, contributing to economic stability and growth. The findings of this research provide valuable insights for policymakers, legal practitioners, and academics, offering a comprehensive understanding of the evolution and future potential of Pre-Packs under the IBC.