The reserve has always been inhabited by the indigenous community of Gonds and Yadav's, who since the creation of the tiger reserve have been gradually moved out. Earlier, there were sixteen villages inside the core area of Panna, but most of these villages have been relocated and currently there are only 3 villages remaining inside the critical tiger habitat. The relocation started in 2009 when Budhrod village was relocated from the core area; at that time around 15 families were relocated. Other villages within the TR such as Talgaon, Malanpur, Jhalar were also relocated at that time. Later in 2012,  Badhaun village was relocated under an ambitious scheme introduced by the NTCA. The entire village is now situated near Panna town, not far from the forest department office [1]. In total 13 villages were relocated from the core areas since the tiger project inception for a total of 983 families (info given by Lock Sabha on 11/12/2017). 

Severe conflicts started to arise in 2015 when the Umravan village protested against the threat of eviction. The legal notification came in February 2015 offering to vacate the place in exchange of cash compensation. When they started to protest against it, they were coerced to give consent without written or accurate information for their resettlement. In August 2015 the administration disconnected the electricity lines and other facilities to the village and let loose elephants in the forests around Umravan village in order to create a situation of panic and force the tribals to flee the village [2, 3]. At that time 70 families were relocated while 9 have remained inside fighting against the relocation drive. A court case has been going on in the Jabalpur High court regarding the illegal relocation process and the implementation of forest rights act in the area. However, despite statutory provisions stating that forest dwellers cannot be relocated before settlement of rights process, the 9 families have been receiving constant threats from the forest officials forcing them to move out of the area. In conversation with Janki Bai, whose family is one of the remaining 9 in the villages and who is also one of the petitioners in the case, she mentioned that the entire relocation process of the Umrawan village has been so poor and haphazard that the villagers who chose to stay back are in better conditions than those who opted to relocate.

A letter written by Yousuf Beg, a trustee of the local Prithvi Trust, was sent to the district collector Shiv Narayan Singh Chouhan. The letter stated that the acquisition of land has been done in an irregular way, no consent and no proper meeting was held with the Gram Sabha as per FRA [2]. The same letter also held the fact that the villagers have been prevented from collecting minor forest products from the forest and are not allowed to cultivate their land. Moreover, no compensation for wildlife attacks was been given, all measures have been used to make the life of the villagers miserable and coerced them to move out [2]. As per a Right to Information Report sent on 15/12/2017 a total of 13 villages have been relocated from the core area of Panna Tiger Reserve, corresponding to 983 families [Lock Sabha reply to question on date 15/12/2017] . 

While many families get relocated outside the forest, mining continues to be carried on inside the buffer area, destroying both the wildlife and the life of many. As declared by Yusuf Beg, the district officials are interested in evicting the villagers to expand the diamond mining ambitions of the state-controlled National Mineral Development Corporation (NMDC) [3]. Panna is the only place in India rich in diamonds, a business which is causing the destruction of biodiversity [8]. A Supreme Court-monitored committee has asked the National Mineral Development Corporation (NMDC) to prepare a closure plan for Panna diamond mine in Madhya Pradesh Panna Tiger Reserve (PTR) by the end of September 2019, however till date the Mine has not been closed and mining lease extensions have been already submitted [9]. Besides the NDMC mining, numerous illegal minings operate in the forest areas all under the watchful eyes of the forest department and local administrations, bringing the local people who live in a situation of poverty, into this chain of illegal work activities [8]. According to the reported news,

the creation of the national park has only brought poverty and work insecurities to the local communities, which are now deprived both of natural resources use as well as of diamond business. Indeed, ‘after the area was declared a national park, more than 50 private diamond mining sites have been closed [...] This has resulted in unemployment and loss of revenue for the state and also promoted the illegal diamond mining,” said a senior officer of the Mineral Resources Department, Madhya Pradesh [10].

Furthermore, a proposed multi-crore irrigation project inside the critical tiger reserve has been proposed since 2005, the Ken-Betwa river linking project which would affect the lives of more than 10 villages, consisting of about 1,585 families, and loss of protected wildlife. The project would submerge an area of 9,000 hectares of which 5,258 hectares are forest land (including 4,141 hectares within the Panna Tiger Reserve – both core and buffer), as per the proposal submitted by the Water Resources Ministry [4,5]. 

The project has been opposed by local people together with the Forest Department especially by the tiger reserve field director R. Sriniwas Murthy, whose opposition might have caused his transfer from the Panna reserve. According to him the river link project will submerge about 50 sq km of prime forest which are part of the Panna Tiger Reserve [7]. 

However there were no consultations held for declaring the area of the buffer zone. There are around 49 villages in the buffer zone and 3 remaining in the core zone.

The Ken Betwa project ( which would submerge a total of 9,000 hectares) of which 4,141 hectares lie within the Panna Tiger Reserve. The project will cause the felling of many trees (Minutes of FAC meeting on March 30, 2017) (with girths above 20 cm. at breast height) perhaps over 23 lakh trees (as given in the DPR) from the Panna Tiger Reserve.