This research study focuses on the concept of Anandavardhana’s Dhvani theory (Theory of Suggestion). In the theory of Dhvani, we see a change from literary excellence or poetic figure to the inner content of poetry in the history of Indian literary theories. And that inner content or implicit meaning is regarded to be the soul of poetry. Anandavardhana was the first to recognize and highlight the importance of meaning or suggestion, which he referred to as the soul of poetry. This research paper analyzes Anandavardhana’s Dhvani theory and how it approaches the meaning or suggestive sense of language. Unlike his predecessors Bharat, Bhamaha, Udabhata, and Vamana, who emphasized the external appearance of poetry, Anandvardhana integrates both the internal and external factors of literature and distinguishes between two kinds of meaning-the explicit and the implicit-and attempts to estimate the worth of literature by giving preference to the implicit rather than the explicit, claiming that implicit meaning is the true essence of literature and called Dhvani. He identifies three levels of meaning Abhidha (denotation), Laksana (implication), and Vyanjana (suggestion).