The origin of the term “Social Exclusion” goes back to mid-1970s when René Lenoir first developed the expression of ‘Social Exclusion’ as a complement to the framework of market discrimination conceptualized by Gary Becker during 1960s (Sen., 2004). However, the phenomenon of social exclusion in the Indian context is not similar to the experience of excluded groups in other countries. In the Indian context, social exclusion differs from other countries mainly on three counts. One, the basis of the social exclusion in Indian context is birth and continues till the death. The birth of an individual in a particular Varna1 (a term that represents groups of castes) decides the socio-economic status in the society. Two, exclusion of an individual is not caused due to the individual characteristics, but could be attributed to societal phenomenon in the sense that an individual can be excluded not due to his characteristics, but due to the reason that he belongs to a certain social group. And thirdly, the notion of impurity is attached to the exclusion and religious sanctions which are continued historically. This differential treatment has been initially conceptualized by Sukhadeo Thorat through the concept of social exclusion to understand the problem of all marginalized groups in India.The main objective of this research paper is to understand the nature of social exclusion concept in Indian context basically in economic perspective. For this, to understand this concept I have used writings of Prof. S.K. Thorat about this concern. According to Thorat, “in India, exclusion revolves around the societal institution that exclude, discriminate, isolate and deprive some groups on the basis of, gender and others” (Thorat and Sadana, 2004). Further, he simplifies that the concept of exclusion is related to the societal institution which exclude, discriminate, isolate and deprives some groups on the basis of group’s identity like caste, ethnicity, religion, gender etc. Social exclusion describes a process by which certain groups are systematically discriminated against because of their caste, religion, gender, disability or other factors. Social exclusion keeps a social group outside power centers and resources. It takes the form of segregation from the social, political, economic, cultural, educational and religious domains of society. It thus imbues a sense of superiority and inferiority in members.