Beginning in the early 1980s for over a decade now, Bangladesh has been contracting structural adjustment loans from the IMF and World Bank. The loans were obtained at highly attractive terms but, were contingent upon fulfillment of stringent policy conditionalities. This study provides an assessment of macroeconomic performance during an entire decade of adjustment, i.e., the 1980s. The macroeconomic performance of Bangladesh in the 1980s has been discouraging. Though, the fiscal and external gaps showed a decline during the adjustment period, other major objectives relating to economic growth, investment, public expenditures, inflation etc. remained unfulfilled. The evidence suggests that contractionary demand management policies while, unable to restrict inflation significantly slowed down economic growth. Coupled with exchange rate depreciation, aggregate demand management policies failed to achieve real exchange rate depreciation. The expected results of the trade liberalization on the industrial sector in particular, were not observed as the sector continued to stagnate. Financial sector reforms were initiated very late in the reform process reflecting a major sequencing problem. Bangladesh’s experience with adjustment policies while raising questions about the design of standard structural adjustment packages also revels the critical importance of strong commitment to reforms and skilful economic management.