Mobile Ad hoc Networks’ (MANETs) properties present major vulnerabilities in security. The threats considered in MANETS are due to maliciousness that intentionally disrupt the network by using variety of attacks and due to selfishness of node which do not perform certain operations due to a wish to save power. In this paper, a co-operative security scheme called Reliable Ad hoc On-demand Distance Vector (RAODV) routing protocol based on local monitoring has been proposed to solve the problem of attack by malicious node as well as selfish behavior. RAODV behaves as AODV in the absence of attack and, detects and isolates misbehaving nodes in the presence of attack. Also it recovers from the attack when a misbehaving node leaves the network or becomes good.