A study of the effect of invisible decay of the third neutrino mass eigen state ν3 on the determination of neutrino mass hierarchy and the octant of the mixing angle θ23 has been done. The decay is characterized by α3= m3/ τ3, where m3 is the mass of ν3 and τ3 its rest–frame lifetime. The effect of matter oscillations and decay have been taken into account. The studies are done with simulated charged current νμ and ν¯μ events in the proposed 50 kt INO ICAL detector. It is found that the mass hierarchy sensitivity is not much affected if the values of α3 are smaller than 2.35 × 10- 4 eV2 (which is the 90% C.L. limit on α3 from the analysis of MINOS data). A significant reduction in hierarchy sensitivity is observed for values of α3 as large as 2.35 × 10- 4 eV2. The dependence of sensitivity to mass ordering on θ23 is also studied. Octant sensitivity is found to increase (worsen) with increase in α3 if θ23 is in the first (second) octant, for non-zero values of α3< 2.35 × 10- 4 eV2, as compared to the no decay case. For α3= 2.35 × 10- 4 eV2, the octant sensitivity is found to increase for both octants of θ23.