Valsa John, who had been helping tribal groups displaced by coal mining companies in Pakur district in the eastern state of Jharkhand, was hacked to death while sleeping at home late on Tuesday night, according to police.
"Nearly 50 people with traditional arms in their hands attacked her house and killed her," Pakur police superintendent Amarnath Khanna told the AFP news agency.
No arrests had yet been made, he said.
John, who campaigned for the rights of triibal people - known as Adivasis - had spoken of threats from the local "mining mafia" who allegedly force tribal people off their land, her younger brother told the Press Trust of India news agency.
Corruption is reportedly rampant in India's mining sector and impoverished local communities have protested that they receive little or no benefit from the booming industry.
In an effort to address growing anger, the government approved a draft law in September which would force coal mining firms to share profits with villagers.
In August anti-corruption campaigner Shehla Masood was shot dead outside her home in the city of Bhopal.
Two senior right-wing politicians are reportedly under investigation in the case.