In this era of modernization and technological developments, the Internet has become indispensable. The internet creates and stores a huge amount of data that may be purchased and sold within and outside the geographical boundary. However, due to its flow and storage beyond the boundaries, it becomes difficult for the state machinery to regulate and monitor its use by the enterprises engaged in its collection and analysis. This makes the data prone to commercial exploitation for economic gains even without the consent of the individuals to whom it belongs, affecting their privacy, life and personal liberty. Due to the increasing exponential industrial value of data, government bodies attempt to protect their citizens data rights. The data protection regulations ensure the security of individual‘s personal data and regulate the collection, storage, usage, transfer, dissemination and disclosure of the data. However, cross-border data storage prevents domestic law enforcement agencies from accessing such data and surveillance of data becomes difficult. Ultimately, the state authorities fail to prevent foreign companies from unauthorised economic gains through the exploitation of such personal data, unauthorised use of personal information and privacy invasion. Therefore, to tackle the challenges raised by the cross- border transfer of data, many countries have attempted to control and protect data transfers through various modes. Data localisation is one such option whereby data protection is sought by the countries. Data localisation refers to the legal requirements for the storage of data, copying of data within the territorial boundaries of a country or/and any restrictive measures on data transfer beyond the national borders. The present paper is aimed at analysing how data localization plays a significant role in Data Protection. The researchers have examined the right-based approach to data localization in the European Union and the choice-based approach to data localization in the United States while discussing the measures to be adopted by India for better data protection in this digital world.