Importance of the topic of the study of the bonded labour release and rehabilitation gains momentum because of the fact that this pernicious system still continues to exist even after 34 years of its legal abolition and that the governments both at the center and the states failed to obliterate the causes of the system. In principle the bonded labour system is abolished by law. But as the situation now stands, it remains as a fact of life. We have seen and heard enough of how the laws were twisted for selfish ends in the rural areas, how the administrative machinery, the revenue, the judiciary, and the police buckle under the pressure, when the local politician says things to them. Eventually if any bold step is taken, it is the agricultural labourer, the who has to suffer. The main aim of this study is to make a census survey of bonded labourers in the district of Mahabubnagar to identify the total number of bonded labour families and their nature of bondage and exploitation corresponding to their socio-economic background. Further, this study aims to study the effects of rehabilitation measures by the government and voluntary organisation and to understand the problems concerned.