This paper tries to capture the externalities that arise from land acquisition and the consequent development that occurs on the acquired land. A case study of Maan village close to Pune in Maharashtra attempts to see if the externalities arising out of the development of land show a caste bias. While the economic condition of the Dalits remains inferior to the non-Dalits, there is no difference in the benefits that have accrued to the Dalits and the non-Dalits due to the externalities. There has been a positive movement in favour of the Dalits as far as issues related to dignity, discrimination and dependence are concerned. They are mainly dependent upon non-governmental jobs, which give them an escape out of the earlier feudal relations but the kind of jobs that they engage in possibly keeps them frozen in traditional caste identities.