Individuals can now carry Indian Rupee denominations of Rs 500 and Rs 1,000 to the limit of Rs 25,000 according to a central bank notification.
Bankers said the idea was to ease cash handling as it became easier to carry Indian currency in higher denominations.
It was also aimed at easing the difficulty Indian tourists faced while travelling to Bhutan since they were required to carry only 100 denominations Indian rupee earlier.
To avoid counterfeit notes, the notification states, various counterfeit note-detecting machines have been installed at commercial banks in Thimphu, Phuentsholing and Gelephu.
