With the development of digital technology, libraries are changing their roles from book providers to e-information providers. Manuscripts are primary source of historic information. Manuscripts are diminishing along with the time. Despite their best efforts, it is difficult to save manuscripts in physical form beyond a time frame. Digital preservation of manuscripts restores it from damage, larceny and decay. Need of digitization of manuscript, digitization initiatives in India, benefits and threats of digital preservation, process of digitization and guiding principles are the key issues discussed in this paper. The paper also discusses manuscripts and rare literature at Panjab University, Chandigarh and digitization projects at Punjab level.