The project being undertaken explores the adaptive reuse and preservation of Marathi vernacular housing with the objective to meet the functional needs of the urban modernists and traditional architecture. The research took a mixed methodology which included field surveys, case studies as well as interviews of the stakeholders in the five heritage sites in Maharashtra. The findings showed that the dwellings were able to accommodate modern functions successfully with the vernacular identity intact at the time of adaptive reuse principles being applied properly, which translates into 82 percent of the dwellings. The sustainable retrofitting methods that were adopted to achieve this energy efficiency are natural ventilation, lime plaster restoration, and the inclusion of solar roofs by as much as 27%. Moreover, a majority of the people who participated in the community (68 percent) reported a strong support on adaptive reuse, associating it with cultural pride and economic development in the area. The study concludes that Maratha houses with their courtyards, stone pillars and timber structures have huge opportunities of being converted into viable contemporary space without losing its authenticity. It highlights that sensitive design-based interventions, traditional craftsmanship, and participatory conservation are the ones that guarantee the continuation of cultures and environmental sustainability. The results make adaptive reuse an important heritage preservation paradigm within the context of a fast urbanizing environment.