This paper investigates how electoral competition affects the rise of a “middle-class” (middle-income group) in the context of a developing country. The theory developed here is based on the traditional Downsian framework and predicts the following. Any increase in electoral uncertainty in a district not only increases the aggregate level of transfers, but also leads to public expenditure of the kind which disproportionately bene?ts the poor as compared to the rich. This, in turn, leads to lowering of income inequality and more importantly lessening of income polarization or a rise of the “middle-class”. We test these hypotheses using data from the Indian parliamentary (national) elections which are combined with household-level consumption expenditure data rounds from NSSO (1987-88 and 2003-04) to yield a panel of Indian districts. Our empirical exercise reveals that districts which have experienced tight elections exhibit lower income polarization and hence a larger middle-class. Also, there is also evidence of a similar relationship between economic inequality and electoral competition. Overall, the empirical analysis shows a strong relationship between electoral uncertainty and the size of the middle class, in support of our theoretical model