Impact of thermal plant discharges on benthic community of Tuticorin Bay and Vaan Island was studied during the period of August 2007 to July 2008. Water quality parameters and heavy metals such as Cd, Cu, Pb, Ni, Zn and Cr in sediment were estimated. As regards biological entity, there were four benthic faunal groups, of this; polychaetes topped the list in terms of abundance in both the regions followed by gastropods, crustaceans and bivalves. Faunal density varied from 552 to 10, 311nos. /m(2) in Tuticorin Bay and 355 to 15, 447nos./m(2) in Vaan Island. Maximum density was found during summer season and minimum during monsoon season. Diversity and richness values were also more in Vaan Island than Tuticorin Bay. Cluster and MDS plots drawn showed that stations of Tuticorin Bay and Vaan Island formed group themselves indicating dissimilarity in their faunal composition and its abundance. BIO-ENV method revealed that temperature, pH, copper and zinc in Tuticorin Bay and zinc and salinity in Vaan Island, as best variable combinations influencing the benthic faunal distribution.