This study on the social impact of economic policies during the last decade in Sri Lanka was undertaken by UNICEF, Colombo office as a part of UNICEF’s global initiative to improve understanding of the social impact of adjustment policies and to promote action for safeguarding the position of vulnerable segments of society. Sri Lanka was a natural choice for carrying out this study owing to her achievements in the field of social welfare, recent changes in economic policies, the high rate of economic growth attained in the past seven years and some stress experienced in the social welfare delivery system. The study focuses on the need to recognize emerging problems which affect vulnerable groups at times of rapid economic development. The objective is to provide a forum of discussion and a basis for social action, which would ensure that the welfare of the most vulnerable groups in Sri Lanka’s population would be preserved.