Abstract Variable Air Volume (VAV) system serving multiple zones often shows energy wastage issues as it is not able to maintain ventilation requirements efficiently at part-load due to inaccurate assumptions of occupancy and inherent inability to detect and use actual occupancy in control. In this study, the operational data of a typical VAV system has been analysed to study the implications of VAV system on energy efficiency and Indoor Air Quality (IAQ), when controlled using occupancy. Three occupancy-based overlapping operational strategies are proposed: 1. Supply air of the zone is optimized to meet the minimum ventilation requirement and to maintain the zone temperature below 24 °C for both occupied and unoccupied zones; 2. In accordance with the 1st strategy, the supply air of the unoccupied zone, if unoccupied for more than 60 min but less than a day, is further minimized to maintain the zone temperature below 28 °C; and 3. In accordance with the 2nd strategy, no ventilation air is supplied to zones that are unoccupied for the entire day. Based on the outcome of this study, the proposed occupancy-based operational strategies show energy saving potential in the range of 23–34%, 19–38%, 21–31% and 24–34% for classroom, computer room, open office, and closed office zones respectively. The primary contribution of this study is the occupancy-based zone level VAV optimization process and its exploration of possible decision-making tools to save energy.