Collection of lichen together with tree twigs of oak and other trees bearing abundant growth of lichens is a common practice among the villagers and the rivals residing near Oak forests in Kumaun Himalaya. Nainital forest division represents about Twenty nine percent vegetation of the Oak forest in Kumaun Himalaya. In Kumaun, the lichen trade share is decreasing at an alarming rate of 21.93% which requires immediate actions by the Government. Lichen contributed significantly to household earnings with off-farm activities and this sector was found second highest income creator after Agriculture. It is a source of cash income during the season of extraction, which increases economic access to food. It has been observed in the present study that the secondary collector and transporters together get maximum share (>50%) of income generated from lichen, thus economic exploitation of the poorly educated people by the traders was still prevalent in the area. To improve the socio-economic standard of the people of Kumaun, it may is necessary to increase and improve the lichens resources of the area. There is a strong need for scientific management, best harvesting practices and strict monitoring of resources. The present study was conducted to assess the present and future resource potential for the conservation and sustainable management of lichens, existing market mechanism, role of Lichens in economic upliftment and livelihood generation of rural communities in Kumaun Himalaya.