River erosion is a common environmental phenomenon in times of flood, especially in the rainy season. The lost land during riverbank erosion forms new land as a long-term result of sediment deposition, locally known as char land. The original tenants who lost their lands during the riverbank erosion can reclaim their lands in the char areas. This study explores the land reclamation patterns in the development of the newly formed land. It focuses on the existing policy and practices of land settlement in the char areas and the conflicts arising from land disputes. Case studies and focus group discussions from the community highlight that land reclamation in the char area is often a community-led informal process without any involvement of the formal administration. These often trigger several factors of disputes. The key challenges in the formal land settlement process in those areas include corruption, prolonged and complex processes, decade-long judicial proceedings, inaccessibility of the claimant at the concerned offices, etc. Additionally, disputes occur due to inter-boundary and intra-boundary demarcation, document forgery, power domination over khas lands, and sometimes unequal distribution of productive land. The findings from this study underscore the need for administrative efficiency through strengthening the local institutions and ensuring proper decentralization. Proper use of satellite and geospatial technology will help to track the real-time survey data of land alluvion–diluvion. Moreover, clear, concise, and updated policy guidelines should be introduced to ensure proper implementation. Installing mediation centers at the heart of the riparian community will allow a wide range of possibilities in land management and reduce the land-related difficulty margin of the riparian community.