Political conflict in developing countries has been a topical issue in recent development literature. While the sources of political conflict encompass a wide range of disciplinary areas, the preoccupation with the ethnocentric perspectives on the issue appears to have concealed the importance of underlying economic factors. The purpose of this article is to redress this gap through a comparative analysis of the experiences of Malaysia and Sri Lanka, which shared much in common with respect to their initial economic, political and social conditions in multi–ethnic societies. The findings of the study suggest that Malaysia could abate the possibilities of its potential political conflict, primarily through the rapid economic development process of the country. Having failed to achieve a development process in a sustainable manner, Sri Lanka, in a deep and prolonged economic stagnancy, nurtured its political conflict in two facets — the southern Sinhala militant uprising and the northern Tamil separatist struggle.
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