Aerosol-cloud interaction is the subject of considerable scientific research, due to the importance of clouds in controlling climate. In the present study, three years (2011–2013) satellite observations are used to investigate the aerosol indirect effect (AIE) over Dehradun. The low values of Angstrom exponent (α) during March–July are attributed to the loading of dust-like coarse particles in the atmosphere, whereas the analysis of aerosol type and Spectral Radiation Transport Model for Aerosol species (SPRINTARS) simulated aerosol species variation supports the fact. Moderate Resolution Imaging Spectroradiometer (MODIS) derived AOD data are associated to the cloud product to examine the dust impact on properties of liquid cloud and ice cloud. The positive values of aerosol cloud interaction effect (ACI) for ice cloud during pre-monsoon (March–May) and monsoon (June–August) seasons reveal the significant impact of dust on ice clouds over Dehradun, which is maximum during May (~0.24 ± 0.05). The present study shows that ice cloud effective radius (ICER) decrease with AOD during dust period. The increase in ice water path (IWP) and ice cloud optical depth (ICOD) reveals the impact of dust on heterogeneous ice generation in low level clouds. However, there is no relation between dust and liquid water cloud during dust period. It is difficult to provide definite conclusions that the dust and cloud changes are driven by the same meteorological conditions. Cloud and the Earth’s Radiant Energy System (CERES) derived flux data are used to examine the associated changes in TOA cloud radiative forcing. The diminution in effective size of ice crystal due to aerosol first indirect effect traps more longwave radiation and reflects more solar radiation. Both first and second indirect effects enhance cloud cooling, whereas the dust induced cloud warming is mainly the result of the semi-direct effect.