In the year 2010, I lived in India from Jan to April & moved to US in May. I am on a L1 visa. I spent more than 183 days in 2010 in the US, hence would be filing 1040.

For the period Jan to March 2010, I have already filed taxes in India.
For April 2010, I had some India income. I also anticipate some additional income in the next 2-3 months in India.

If I decide to file a tax return in India for the income earned in India, should I still show the India income in the US Tax return when I do my taxes for 2010?

You can only file as a resident if you are married. You would file jointly wioth your spouse and BOTH of you would choose to be treated as resident aliens for all of 2010. ALL world-wide income for 2010 would be subject to U.S. income taxes, and you can claim the Foreign Tax Credit using Form 1116.

If you are single, you MUST file as a dual-status alien and pay taxes ONLY on the U.S.-sourced income earned in 2010.