This paper describes the implications of the land acquisition process in a village in the Gurgaon district of Haryana state in northwestern India. Gurgaon city, the district capital, is emerging as a major industrial hub, its growth made possible by the large-scale acquisition of agricultural lands by the government. The expansion of the city has altered patterns of rural natural resource use, created social, cultural and economic changes, and bred resentment among many peri-urban residents against urban authorities. The current top-down policies for land acquisition need to be revisited and replaced by more participative processes in which landowners and peri-urban residents themselves are involved. The speedy disbursement of reimbursements for lands acquired, and the spread of livelihood generation activities, can make processes of urbanization more inclusive and participatory. Improving transportation and connectivity to the city will be essential for sustaining new peri-urban livelihoods.