The theme of Quranic commands is promoting collective goodness and virtuous qualities in human beings and providing preventive and precautionary measures to minimize the commission of crimes. However, in the event of happening of crimes, fair and unbiased justice has been awarded the prime importance in the Islamic law, derived mainly from the Holy Quran, Hadith and compilations of Islamic jurisprudence. The Islamic law has deeply embedded elements of what we call today as the restorative system; an alternative paradigm being advocated globally since the 1970s for tackling the trend of rising crimes and relatively low efficacy of the conventional retributive form of justice and the preventive theory of punishment. The law of Qisas (retaliation), the practices of conciliation or Suluh, restitution or compensation (Diyya, meaning blood money), isolation, forgiveness, community service, warning, fining and reintegration are all components of the Islamic law which are very much analogous to the concept of restorative justice. In all these matters, the role of the victim is dominant and central, a mandatory precondition of contemporary restorative practices. It is particularly relevant to discuss about the provisions under Diyya; a unique concept of the Islamic criminal justice system which is the payment of money to the victim of a violent crime and is very much analogous to the attributes of restorative justice. Diyya is not just limited to homicide; its provisions are applicable for any injury or incident resulting in bodily harm, intentional or unintentional, caused by another person. The payment can be made in substitution for the Qisas penalty at the request of the victim or it can be imposed if any of the procedural or substantive requirements for the imposition of Qisas have failed. It needs to be pointed out here that Diyya is translated as ‘blood money’, a negative connotation, undermining the virtues of this concept. It should better be seen as one of the best examples of restorative justice in the criminal justice systems of the world in the form of restitution to the victim paid by the guilty offender. There are numerous examples of implementation of Diyya in Islamic countries, where not only the lives of those who had been awarded death penalties were saved but also the families of victims were paid Diyya to help them rehabilitate and restore their place in the society. The procedures under Qisas and Diyya being victim-centric, the final option that victims have in a case of intentional homicide or wounding is to forgo both the penalty and restitution and forgive the offender; an act which has been highly appreciated in the Holy Quran and Hadith. It is pertinent to record here that the credibility of the concept of Diyya, its utilitarian nature and its restorative character are unambiguous, not only because it is a component of the Divine Law of Islam but also because of the fact that systems like Diyya are in practice in countries such as Japan and Korea and had been prevalent in many parts of Europe just about the time when Diyya was included as a tenet of the Islamic law. The concept of Diyya convincingly illustrates as to how restorative justice could have an edge over retributive and retaliatory justice.