A Yahoo spokesperson said the company was "making some changes to the way we operate in Bangalore leading to consolidation of certain teams into fewer offices".
About 400 employees will be affected by the cuts, according to reports.
But Yahoo told the BBC that the majority of the more than 1,000 workers in Bangalore will not be "impacted".
"Bangalore will certainly continue to remain an important centre for Yahoo," the spokesperson said.
It also added that relocation packages will be offered to some employees, suggesting that some jobs may be moved to its US headquarters in Sunnyvale, California.Yahoo 'growth'
News of the redundancies comes after reports this week that the California-based company was close to investing millions of dollars in mobile messaging service Snapchat.
Yahoo has been making headlines for acquisitions under chief executive Marissa Mayer, who has been trying to boost its stalling revenue growth since joining in 2012.
The company sold about $8bn (£4.9bn) worth of shares in Chinese firm Alibaba's public listing last month, prompting the shopping spree talks.
The company did say it was on a path of "sustainable growth".
"We're looking at ways to achieve greater efficiency, collaboration and innovation across our business," it said in a statement.