Fistula-in-ano is a common anorectal condition requiring surgical intervention to eradicate the fistula while preserving anal sphincter function. This study compares the clinical outcomes of Fistulectomy and Seton placement for the management of fistula-in-ano. A prospective study was conducted at R.D. Gardi Medical College, Ujjain, involving 56 patients diagnosed with fistula-in-ano. Patients were categorized into two groups: Fistulectomy and Seton placement. Outcomes assessed included operative time, hospital stay, healing time, pain, infection, recurrence, and incontinence at one week, one month, and three months postoperatively. The mean age of participants was 38.96 years, with a male predominance (80.4%). Low fistulas were more prevalent (60.7%), and common symptoms included discharge (89.3%) and swelling (80.4%). Operative time was significantly shorter in the Seton group, while Fistulectomy resulted in shorter hospital stays. Infection rates at one week were higher in the Fistulectomy group (24.8% vs. 10.3%). Recurrence and incontinence rates were significantly lower in the Seton group at three months (recurrence: 17.2% vs. 33.3%; incontinence: 3.4% vs. 29.6%).