Artificial Intelligence (AI) is rapidly transforming the design, conduct, and analysis of clinical trials by enhancing efficiency, accuracy, and predictive capabilities. AI-driven tools are increasingly used for patient recruitment, risk stratification, trial monitoring, adverse event detection, and data analysis. While these innovations promise to accelerate drug development and improve patient outcomes, they also raise complex legal, ethical, and regulatory concerns. Issues relating to data privacy, algorithmic bias, transparency, accountability, and medical negligence pose significant challenges within the existing legal framework. This paper critically examines the application of AI in clinical trials and evaluates its implications under Indian law. It analyzes the regulatory landscape governing clinical research, data protection, and medical negligence, with reference to the Drugs and Cosmetics Act, 1940, the New Drugs and Clinical Trials Rules, 2019, the Bharatiya Sakshya Adhiniyam, 2023, and emerging data protection norms. The study further explores the role of expert testimony in AI-related disputes and assesses the need for adaptive legal standards. Based on doctrinal research and secondary sources, the paper argues for the development of a comprehensive AI-specific regulatory framework to ensure ethical innovation while safeguarding participant rights.