Bhool Bhulaiyaa 3 includes a queer-affirming narrative arc for the ghost character Debendranath, whose journey to peace is achieved through the acceptance of his queer identity. This depiction is considered a progressive representation in mainstream Indian cinema, highlighting acceptance and redemption. While the film faced a ban in Saudi Arabia due to its LGBTQ+ content, its internal narrative maintains a respectful and empathetic stance.

Bhool Bhulaiyaa 3 portrays its transsexual character, Debendranath, with empathy and depth. The narrative arc centers on acceptance and redemption, challenging stigma through a sympathetic depiction of gender identity. Despite minor pronoun confusion, the film's overall message is progressive, promoting understanding and love within a mainstream Bollywood context.

The film deeply integrates Hindu beliefs about the afterlife, moksha, acceptance, and forgiveness as central to its narrative. It portrays these concepts as instrumental in a spirit's journey from vengeance to peace, thereby aligning the narrative with the virtues and dignity of the faith.