This paper attempts to trace the genesis and consolidation of a class of rich peasants in the districts that now constitute Bangladesh. It is argued that at least in some areas a powerful class of well-to-do peasants existed even before the British introduced the Permanent Settlement. Furthermore, far from creating a situation where a more or less homogeneous body of peasantry were helpless in the face of unchecked exploitation by the zamindars, the Permanent Settlement in fact ushered in a period of class struggle between zamindars and rich peasants, but also, and increasingly, by the partly or wholly expropriated poorer peasants. It is suggested that by and large, by the first or second decade of this century, the rich peasants had in most areas of the country wrested effective economic and political power from the zamindars. The new rural power elite, who continue to dominate the rural scene today, are rich-peasants-cum-petty-landlords who were recruited partly from the richer strata of the peasantry and partly from the ranks of intermediate tenureholders.