diff --git a/yaksh/models.py b/yaksh/models.py
index fd483189f..27ee9dd4c 100644
--- a/yaksh/models.py
+++ b/yaksh/models.py
@@ -1367,6 +1367,14 @@ class Question(models.Model):
     # The type of question.
     type = models.CharField(max_length=24, choices=question_types)
 
+    # Negative marks for the question
+    negative_marks = models.FloatField(
+        default=0.0,
+        help_text='In Percentage eg: 25, '
+        'means 0.25 will be negative marks if question is for 1 mark'
+    )
+
+
     # Is this question active or not. If it is inactive it will not be used
     # when creating a QuestionPaper.
     active = models.BooleanField(default=True)
@@ -1732,10 +1740,16 @@ class Answer(models.Model):
     comment = models.TextField(null=True, blank=True)
 
     def set_marks(self, marks):
-        if marks > self.question.points:
-            self.marks = self.question.points
-        else:
-            self.marks = marks
+        points = self.question.points
+        qtype = self.question.type
+        if marks > points:
+            marks = points
+        if qtype == 'mcq' or qtype == 'mcc':
+            wrong_fraction = points - marks
+            negative_marks = wrong_fraction * (self.question.negative_marks/100)
+            marks = marks - negative_marks
+        self.marks = marks
+        self.save()
 
     def set_comment(self, comments):
         self.comment = comments
@@ -2629,16 +2643,16 @@ def regrade(self, question_id, server_port=SERVER_POOL_PORT):
             if question.partial_grading and question.type == 'code':
                 max_weight = question.get_maximum_test_case_weight()
                 factor = result['weight']/max_weight
-                user_answer.marks = question.points * factor
+                user_answer.set_marks(question.points * factor)
             else:
-                user_answer.marks = question.points
+                user_answer.set_marks(question.points)
         else:
             if question.partial_grading and question.type == 'code':
                 max_weight = question.get_maximum_test_case_weight()
                 factor = result['weight']/max_weight
-                user_answer.marks = question.points * factor
+                user_answer.set_marks(question.points * factor)
             else:
-                user_answer.marks = 0
+                user_answer.set_marks(0)
         user_answer.save()
         self.update_marks('completed')
         return True, msg
diff --git a/yaksh/static/yaksh/js/add_question.js b/yaksh/static/yaksh/js/add_question.js
index 551c61101..ec6a48227 100644
--- a/yaksh/static/yaksh/js/add_question.js
+++ b/yaksh/static/yaksh/js/add_question.js
@@ -183,6 +183,11 @@ function autosubmit()
 }
 
 $(document).ready(() => {
+    $("#id_negative_marks").closest("tr").hide()
+    let qtype = $("#id_type").val();
+    if (qtype === "mcq" || qtype === "mcc") {
+        $("#id_negative_marks").closest("tr").show()
+    }
     let option = $('#id_language').val();
     if(option === 'other') {
         $('#id_topic').closest('tr').show();
@@ -210,5 +215,10 @@ $(document).ready(() => {
         } else {
             $('#id_language').children("option[value='other']").show();
         }
-    })
-});
\ No newline at end of file
+        if (value === "mcq" || value === "mcc") {
+            $("#id_negative_marks").closest("tr").show()
+        } else {
+            $("#id_negative_marks").closest("tr").hide()
+        }
+    });
+});
diff --git a/yaksh/test_models.py b/yaksh/test_models.py
index 019e2fc52..6ead1f320 100644
--- a/yaksh/test_models.py
+++ b/yaksh/test_models.py
@@ -1790,6 +1790,62 @@ def test_update_marks(self):
         self.assertTrue(self.answerpaper.passed)
         self.assertFalse(self.answerpaper.is_attempt_inprogress())
 
+    def test_update_marks_with_negative_marks(self):
+        # Given
+        question = self.answer_wrong.question
+        question.negative_marks = 25
+        question.save()
+
+        # When
+        self.answer_wrong.set_marks(1)
+        self.answerpaper.update_marks()
+
+        # Then
+        self.assertEqual(self.answerpaper.marks_obtained, 2)
+        self.assertEqual(self.answerpaper.percent, 66.67)
+
+        # When
+        answers = self.answerpaper.answers.filter(question=question)
+        for answer in answers:
+            answer.set_marks(0)
+        self.answerpaper.update_marks()
+
+        # Then
+        self.assertEqual(self.answerpaper.marks_obtained, 0.75)
+        self.assertEqual(self.answerpaper.percent, 25)
+
+        # When
+        for answer in answers:
+            self.answer_wrong.set_marks(-1)
+        self.answer_wrong.set_marks(0)
+        self.answerpaper.update_marks()
+
+        # Then
+        self.assertEqual(self.answerpaper.marks_obtained, 0.75)
+        self.assertEqual(self.answerpaper.percent, 25)
+
+        # When
+        for answer in answers:
+            self.answer_wrong.set_marks(0.5)
+        self.answerpaper.update_marks()
+
+        # Then
+        self.assertEqual(self.answerpaper.marks_obtained, 1.375)
+        self.assertEqual(self.answerpaper.percent, 45.83)
+
+        # Given
+        question.negative_marks = 0
+        question.save()
+
+        # When
+        for answer in answers:
+            self.answer_wrong.set_marks(0)
+        self.answerpaper.update_marks()
+
+        # Then
+        self.assertEqual(self.answerpaper.marks_obtained, 1)
+        self.assertEqual(self.answerpaper.percent, 33.33)
+
     def test_set_end_time(self):
         current_time = timezone.now()
         self.answerpaper.set_end_time(current_time)
@@ -1818,6 +1874,61 @@ def test_set_marks(self):
         self.assertEqual(self.answer_wrong.marks, 0.5)
         self.answer_wrong.set_marks(10.0)
         self.assertEqual(self.answer_wrong.marks, 1.0)
+        self.answer_wrong.set_marks(0)
+        self.assertEqual(self.answer_wrong.marks, 0)
+
+    def test_set_marks_with_negative_marks(self):
+        # Given
+        question = self.answer_wrong.question
+        question.negative_marks = 25
+        question.save()
+
+        # When
+        self.answer_wrong.set_marks(1)
+        # Then
+        self.assertEqual(self.answer_wrong.marks, 1)
+
+        # When
+        self.answer_wrong.set_marks(0)
+        # Then
+        self.assertEqual(self.answer_wrong.marks, -0.25)
+
+        # When
+        self.answer_wrong.set_marks(0.5)
+        # Then
+        self.assertEqual(self.answer_wrong.marks, 0.375)
+
+        # Given
+        question.negative_marks = 0
+        # When
+        self.answer_wrong.set_marks(1)
+        # Then
+        self.assertEqual(self.answer_wrong.marks, 1.0)
+
+        # When
+        self.answer_wrong.set_marks(0)
+        # Then
+        self.assertEqual(self.answer_wrong.marks, 0)
+
+    def test_no_negative_marks_except_mcq_mcc(self):
+        # Given
+        code_question = self.answer1.question
+        marks = self.answer1.marks
+        code_question.negative_marks = 25
+        code_question.save()
+
+        # When
+        self.answer1.set_marks(1)
+        # Then
+        self.assertEqual(self.answer1.marks, 1)
+
+        # When
+        self.answer1.set_marks(0)
+        # Then
+        self.assertEqual(self.answer1.marks, 0)
+
+        self.answer1.marks = marks
+        self.answer1.save()
 
     def test_get_latest_answer(self):
         latest_answer = self.answerpaper.get_latest_answer(self.question1.id)
diff --git a/yaksh/views.py b/yaksh/views.py
index 4a6f462d2..35b010aef 100644
--- a/yaksh/views.py
+++ b/yaksh/views.py
@@ -987,22 +987,24 @@ def _update_paper(request, uid, result):
     paper = new_answer.answerpaper_set.first()
 
     if result.get('success'):
-        new_answer.marks = (current_question.points * result['weight'] /
-                            current_question.get_maximum_test_case_weight()) \
+        marks = (current_question.points * result['weight'] /
+                 current_question.get_maximum_test_case_weight()) \
             if current_question.partial_grading and \
             current_question.type == 'code' or \
             current_question.type == 'upload' else current_question.points
+        new_answer.set_marks(marks)
         new_answer.correct = result.get('success')
         error_message = None
         new_answer.error = json.dumps(result.get('error'))
         next_question = paper.add_completed_question(current_question.id)
     else:
-        new_answer.marks = (current_question.points * result['weight'] /
-                            current_question.get_maximum_test_case_weight()) \
+        marks = (current_question.points * result['weight'] /
+                 current_question.get_maximum_test_case_weight()) \
             if current_question.partial_grading and \
             current_question.type == 'code' or \
             current_question.type == 'upload' \
             else 0
+        new_answer.set_marks(marks)
         error_message = result.get('error') \
             if current_question.type == 'code' or \
             current_question.type == 'upload' \