This paper examines the extent and source of inequality in the distribution of land holdings in Himachal Pradesh using various inequality measures. The results revealed that the trend in inequality has consistently declined, suggesting an improvement in the overall inequality in the land distribution. The Gini's Coefficient has declined from 0.6081 in 1970-71 to 0.5483 for 1985-86. Theil's indices computed separately for the number of holdings and area operated for the four time periods suggest that though the concentration is greater in the case of number of holdings than in the case of area operated yet the concentration has increased in the former and declined in the latter case.' Atkinson's index which has declined from 0.5455 in 1970-71 to 0.4110 in 1985-86 implies that same level of social welfare can be obtained with 45 per cent of the total operated land during 1970-71 and 58.9 per cent of total operated land in 1985-86. The reduction in skewness may have a favourable effect on both production and social environment.