A solid middle class can provide the backbone for more stable societies and sustained welfare. Ecuador’s experience, alike that witnessed elsewhere in LA, has yet to reach that footing. This chapter analyzes the roots of the stark decline of poverty and the commensurate rise of an emerging middle class in Ecuador. These trends happened on the back of a strong rise in real wages and active social policies supported in part by booming international commodity prices. Not being rooted in sustained aggregate productivity growth and structural change towards modern services and industries, the size of the middle class and its welfare are still highly vulnerable to global market volatility.