This study is concerned with Iban involvement in commercial handicraft production (CHP). Its aim has been to examine the possibilities of employment expansion through small-scale rural industrialisation in Sarawak, Malaysia and to discuss differential Iban involvement and "success" in CHIP. The pertinent questions are: why do some Iban craftspersons take up CHP, while others do not; and under what conditions do Iban craftspersons succeed in CHIP? By undertaking this research, it is hoped to establish whether rural industrialisation based on craft production is "desirable" and 'feasible" for the rural Iban. Survey methods were employed from 200 Iban craftspersons from 10 longhouses in Kapit Division, Sarawak supported by participant observation in addition to in-depth interview with government personnel and selected entrepreneurs (such as tour operators, Chinese towkays). The thesis argues for a reinterpretation of Iban economic history because previous research on the Than economy has tended to ignore Iban involvement in non-agricultural activities, particularly in commercial activities. Although the Iban have become increasingly oriented to the market, there has been very little attention to the evolving landscape of the Iban economy. The study shows that Iban involvement in commercial activities does not occur in linear evolutionary phases; it is a variable and fluid response to changes in the social, economic, cultural and political environment. The study also shows that CI-[P provides the rural Iban with employment and income earning opportunities which, in turn enables them to sustain their livelihood whilst regenerating interest in Iban culture. Some craftspersons have succeeded in CHIP and have even managed to market their products beyond their local region. The majority, however, have been unable either to initiate, or once involved, to survive in CHIP because of constrains identified in marketing, availability of raw material, capital, labour, lack of entrepreneurship and institutional support, and certain cultural obstacles. Despite these problems, the majority of those Iban surveyed are willing to take up CHIP in the future suggesting that there is potential for the development of rural industrialisation in Sarawak. This study is a first step towards understanding the nature, extent and effects of Iban involvement in commercial activities, which is a neglected subject in development studies in Malaysia and the interplay of factors that promote or hinder their role in economic development