The sanctuary is part of the western ghats, a biodiversity hotspot. It also comes under the Nilgiri Biosphere Reserve and forms a part of the Wayanad Elephant Reserve.

The sharp topographical gradient of the hills of sanctuary ranging from 40 to 1506 m is the primary reason for the diversity of plants and animals. The areas merge with the Wayanad Plateau. Steep hills, deep valleys, marshy lands etc. with hillocks, perennial water sources combined with altitudinal variations make it an ideal habitat for a variety of flora and fauna. The area also supports several endemics and many rediscovered species. A few species occurs only within the sanctuary The forests of Kakkayam is contiguous with the unique mountain systems of Banasuramala (2050m), Vellarimala (2100m), Kurichyarmala (1606m), Kakkanmala (1456m) and Vannathimala (1505m) and thereby occupy a unique position in the Southern Western Ghats.

The sanctuary area constitutes the watersheds of Kuttiady River. The reservoirs at Kakkayam, Peruvannamuzhy and Banasuramala are lifeline of the inhabitants in Kozhikode district as they are the source of drinking water. Electricity is also generated from the hydro-electric project. The picturesque dam site, unique climate, richness of biodiversity and gorgeous waterfalls of Urakkuzhi offers good eco tourism potential and is an important tourist destination of this region.

The forest catchment of the sanctuary is a rich conservatory of the basic resource of life “Water”. The reservoirs, the rivers and the projects in the area, sustain the water and power (electric) need of Kozhikode and Malabar.