The Man-Eater of Malgudi has been interpreted in two different ways: as an allegory of good and evil, and as a study in identification and displacement. Readings of the work as an allegory focus on the relationship between the narrator Nataraj, the passive and well-meaning printer of the town of Malgudi, and Vasu, the eccentric taxidermist and out-of-towner who forces his way into Nataraj's attic and uses it to house himself and practice his seemingly grisly profession. In the allegorical view, Narayan represents Indian passivity while Vasu embodies the aggressive forces of modernism poised to threaten and destabilize Indian society. Certainly, Vasu unsettles the whole community and seems to overwhelm everyone with his brusque personality and antisocial tendencies. This version of the plot of The Man-Eater of Malgudi derives credibility from the mythological underpinnings of the narrative: Vasu is cast in the novel as a rakshasha, one of the demons who challenges the gods and introduces chaos into existence. Specifically, Nataraj's assistant, Sastri, characterizes Vasu as Bhasmasura, a demon in Hindu myths who blights everything he touches, defies the heavens, and makes ordinary human beings suffer. In the end, however, Bhasmasura overreaches himself and self-destructs — an example of pride that inevitably leads to a fall. In the novel itself, Vasu frightens everyone in Malgudi, disrupts the lives of its citizens, and attempts to obstruct its rituals. Ultimately, however, he kills himself while trying to squash a mosquito which lands on his forehead.
The other, radically different, reading of The Man-Eater of Malgudi treats it as a narrative of identification; a work where the narrator-protagonist Nataraj is aroused from his inconsequential mode of existence by the energetic Vasu. According to this version, Nataraj increasingly acts and thinks like Vasu until he reaches a point when he has to get rid of the man who embodies the more primitive and instinctive self that has been bottled up in him for such a long time. Nataraj, in other words, emerges as a much stronger figure at the end of the novel and is even able to displace Vasu by forcing him into a corner from which he has no way out except through self-destruction.