Neutralino dark matter in supersymmetric models is revisited in the presence of flavor violation in the soft supersymmetry breaking sector. We focus on flavor violation in the sleptonic sector and study the implications for the co-annihilation regions. Flavor violation is introduced by a single $\tilde��_R-\tilde��_R$ insertion in the slepton mass matrix. Limits on this insertion from BR($��\to ��+ ��$) are weak in some regions of the parameter space where cancellations happen within the amplitudes. We look for overlaps in parameter space where both the co-annihilation condition as well as the cancellations within the amplitudes occur. In mSUGRA, such overlap regions are not existent, whereas they are present in models with non-universal Higgs boundary conditions (NUHM). The effect of flavor violation is two fold: (a) it shifts the co-annihilation regions towards lighter neutralino masses (b) the co-annihilation cross sections would be modified with the inclusion of flavor violating diagrams which can contribute significantly. Even if flavor violation is within the presently allowed limits, this is sufficient to modify the thermally averaged cross-sections by about (10-15)% in mSUGRA and (20-30)% in NUHM, depending on the parameter space. In the overlap regions, the flavor violating cross sections become comparable and in some cases even dominant to the flavor conserving ones. A comparative study of the channels is presented for mSUGRA and NUHM cases.

38 pages, 28 figures. Significantly expanded and improved version with a new section on channels and new appendices on mSUGRA and cross-sections, version accepted for publication in JHEP