Poorly designed compensation policies, inadequate planning, the entry of land sharks and the weak power of rural communities are resulting in a deterioration of the living conditions of those displaced by land alienation from the fringes of cities. Field surveys on the fringes of Hyderabad-Secunderabad, where a vast number of infrastructure projects, special economic zones and institutions are planned, show the adverse impact of involuntary displacement. A major correction of land acquisition and compensatory policies is called for, lest the simmering resentment expresses itself in open conflict.