This paper proposes a rule based approach for sentiment analysis from Malayalam movie reviews. The research in Sentiment Analysis nowadays become one among active research areas in natural language processing. Sentiment Analysis is the cognitive process in which the user's feeling and emotions are extracted. The growing importance of sentiment analysis coincides with the growth of social media such as reviews, forum discussions, blogs, and social networks. Sentiment analysis enables computers to automate the activities performed by human for making decisions based on the sentiment of opinions, which has wide applications in data mining, web mining, and text mining. Negation Rule has been applied for extracting the Sentiments from a given text. This system gives the polarity at the sentence level for the movie reviews with an accuracy of 85%, when analysed.