Management of invasive alien species is increasingly challenging mainly because of the failure of past global efforts to slow down the rate of invasion and increasing globalization of trade and transport. Developing countries like Nepal are further constrained due to the lack of adequate scientific knowledge to inform policy and management. This has resulted in weak policy and management responses, thereby exposing the country to a high threat of further invasions. This paper presents a brief review of the diversity, distribution, and impacts of invasive alien plants (IAPs), current management practices and policy responses, and future prospects for their management in Nepal. At least 183 vascular exotic plant species (4 pteridophytes and 179 flowering plants) are naturalized in Nepal, and among these are 26 invasive angiosperm species, including 4 from the list of 100 of the world’s worst invasive species. The IAPs have invaded agroecosystems and the natural environment including protected areas and Ramsar sites from tropical lowland to temperate mountain zones. Impacts of a few IAPs have been examined, and they range from habitat degradation and species displacement to negative impacts on the livelihood of farming communities. Cultural and physical methods are the common control measures adopted, while a few biological control agents have also arrived fortuitously. As a policy response, the National Biodiversity Strategy and Action Plan 2014 prioritized inventory, impact assessment, identification of dispersal pathways, public education and participation, and biological control programs. Future prospects for the IAPs management in Nepal includes eradication of Myriophyllum aquaticum, prevention of Mikania micranthaand Chromolaena odorata from being spread to western Nepal, inclusion of IAPs management in community forestry programs and conservation management plans of protected areas, invasion risk assessment of species before introduction, government funding for education and research, strengthening biological control programs, and regional collaboration through common management strategies.