Using the Indian-American community as a case study, this paper articulates the different theoretical and political spaces opened up by diasporic politics. While diasporas help disrupt the forceful hold of the nation-state on the global political imagination, there is nothing inherently politically progressive, subversive or liberatory about diasporic mobilizations. Indeed, the content of such mobilizations needs to be scrutinized carefully to show how such mobilizations can both reproduce the nation-state in deeply troubling ways as well as make possible progressive political mobilizations that can challenge vested dominant interests in both home and host states. The paper argues that the diasporic challenge to the nation-state framework calls for a reconceptualization of the concept of 'territory', and raises serious questions about the nature of 'citizenship and democracy' in an increasingly interconnected world.