We have examined the patterns of DNA sequence variation in and around the genes coding for ICAM1 and TNF, which play functional and correlated roles in inflammatory processes and immune cell responses, in 12 diverse ethnic groups of India. We aimed to (a) quantify the nature and extent of the variation, and (b) analyse the observed patterns of variation in relation to population history and ethnic background. At the ICAM1 and TNF loci, respectively, the total numbers of SNPs that were detected were 28 and 12. Many of these SNPs are not shared across ethnic groups and are unreported in the dbSNP or TSC databases, including two fairly common non-synonymous SNPs at positions 13487 and 13542 in the ICAM1 gene. Conversely, the TNF-376A SNP that is reported to be associated with susceptibility to malaria was not found in our study populations, even though some of the populations inhabit malaria endemic areas. Wide between-population variation in the frequencies of shared SNPs and coefficients of linkage disequilibrium have been observed. These findings have profound implications in case-control association studies.