This thesis investigates marginalisation in small-scale fishing communities in Chilika Lagoon engaged in customary capture fisheries. However, the Lagoon has undergone tremendous changes in recent decades, impacting the social, cultural, economic, political and environmental life, and resulting in fishers’ disconnection and marginalisation. The study explores what marginalisation looks like from the fishers’ point of view, and attempts to explain the processes and drivers responsible for change in Chilika social-ecological system, and the implications of this change, with four areas for analysis: 1) historical and political background to the processes of change in Chilika Lagoon fisheries; 2) the challenges from external drivers to fishery commons and the need to understand commons as a process; 3) impacts of social-ecological change from a livelihood perspective, including how the fishers dealt with livelihood crisis through various strategies; 4) institutional processes and their implications for fishers’ marginalization. Using evidence collected through household- and village-level surveys, combined with various qualitative and participatory research methods over 28 months, the study shows that there are two major driving forces or drivers of marginalisation: (1) the role of aquaculture development in the loss of resource access rights and the decline of local institutions, and (2) the ecological displacement and livelihood loss brought about by the opening of a new “sea mouth” connecting the Lagoon and the Bay of Bengal. There exist a paradox of the official account and fishers’ own view of marginalisation. Chilika is a clear case in which government policies have encouraged de facto privatisation. The dynamic nature and fluctuations associated with commons development make it imperative to understand commons as a process that includes commonisation and decommonisation. Out-migration has emerged as a key livelihood strategy resulting in occupational displacement for one-third of the adult fishers, and such livelihood strategies have led to their disconnection and marginalisation. The fishers’ point of view presents a more complex, multidimensional concept of marginalisation, not simply as a state of being but as a process over time, impacting social and economic conditions, political standing, and environmental health.