The term psychological novel also refers to works of prose fiction draws upon contemporary psychological theories and recent studies of the psychological novel have focused on historical convergences between the two fields. An example for the psychological sufferings is Anita Desai’s works like Voices in the City and Where Shall We Go This Summer. These works portrayed the complexities in man-woman relationship. Her novel, Cry the Peacock is concerned with its chief protagonist Maya’s psychological problems. Divakaruni is an award winning author and Indian born American author also. Her latest novel Oleander Girl is having some psychological aspects including Erikson’s Psychosocial Development theory. Erikson’s developmental theory illustrate about human life span. In Oleander Girl Divakaruni draws characters and also incidents as from infancy to maturity. Key Words: Identity crisis, Psychological Development, Infancy, Adulthood, Maturity, Immigrants, Hindu and Muslim clashes, traditional vs. new India.