Cadmium (Cd) causes oxidative damage and affects nodulation and nitrogen fixation process of legumes. Arbuscular mycorrhizal (AM) fungi have been demonstrated to alleviate heavy metal stress of plants. The present study was conducted to assess role of AM in alleviating negative effects of Cd on nodule senescence in Cajanus cajan genotypes differing in their metal tolerance. Fifteen day-old plants were subjected to Cd treatments—25 mg and 50 mg Cd per kg dry soil and were grown with and without Glomus mosseae. Cd treatments led to a decline in mycorrhizal infection (MI), nodule number and dry weights which was accompanied by reductions in leghemoglobin content, nitrogenase activity, organic acid contents. Cd supply caused a marked decrease in nitrogen (N), phosphorus (P), and iron (Fe) contents. Conversely, Cd increased membrane permeability, thiobarbituric acid reactive substances (TBARS), hydrogen peroxide (H2O2), and Cd contents in nodules. AM inoculations were beneficial in reducing the above mentioned harmful effects of Cd and significantly improved nodule functioning. Activities of superoxide dismutase (SOD), catalase (CAT), and peroxidase (POD) increased markedly in nodules of mycorrhizal-stressed plants. The negative effects of Cd were genotype and concentration dependent.