This chapter illustrates the importance of an understanding of class relations to the processes of capitalist development at a regional scale by examples drawn from the Welsh context, and particularly from South Wales. The difference in South Wales between the coal and steel industries is that while they were characterized by similar work control patterns initially, they evolved differently. This had important effects upon the form taken by unionization, and hence industrial strength and class solidarity around both workplace and community, the spheres of production and reproduction. In this chapter, the author outlines of the complex manner in which, in postwar South Wales, a process of reproducing capitalist social relations has been enacted. The chapter addresses the centrality of the state in bringing this process to the point of fruition, and the contradictory effects of the processes involved upon the further development of regional class relations. A twofold creation of relative surplus population has taken place in South Wales.