This paper focusses on the adverse impact of colonisation and colonization on the rural people and economy of the Punjab during colonial period. The economy of Punjab underwent tremendous change during the colonial period. Although the Colonisation brought prosperity as these projects were the chief factor for the growth of agriculture in Punjab. But this prosperity was brought at the expense of rural people of Punjab. The main aim of undertaking this research paper was to find out how much the rural people especially of canal colonies were affected by the irrigational works and what were the problems they had to face.