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This paper is concerned with the problem of social inequalities and economic development in rural communities. Two ethnically different communities were chosen in the most southern state of Brazil: Garibaldi, of descendants from Italian immigrants, and Candelaria, of descendants from German immigrants. The data were gathered through application of a questionnaire to stratified random samples, representing 4.2% of the farm owners in Candelaria and 7% in Garibaldi. The central assumption of the study was that the larger farm owners occupy the highest socioeconomic positions in the agrarian society and, therefore, have the best opportunities for economic development as indicated by correlates such as income (economic variable), education and mass media (social variables) and alienation (psychological variable). The study findings show that the economic and social development of rural communities, irrespective of ethnic origins, appears to depend on structural variables, such as the land tenure system. In terms of strategies for development, it is suggested that the inequalities that seem to exist in land ownership be corrected. Tables provide the study data, and a bibliography is included. (Author/DB)