This thesis aims to explore and understand the changes to the social institution of caste that arise from the ongoing modernisation of Indian society. The research setting is the IT industry in Bangalore and Hyderabad. As the Indian IT industry is the economic sector most exposed to globalised modernisation, it has come to represent a social milieu deemed particularly modern in India. The thesis discusses the social role of the IT industry in India; the rise of the new middle classes, and the specifics of the locality of Bangalore. It is argued that caste as a social institution systematically connects three different dimensions of human existence; the economic (caste-wise division of labour); the biological (rules concerning exogamy and endogamy); and the ideational (various rationalisations for caste). While the economic dimension of caste is increasingly losing its meaning, caste endogamy remains largely intact and is rationalised in forms much more compatible with modernity. This composite model of caste is then contrasted with a model of modernity based arguments presented by the most relevant sociologists, from Max Weber to Peter Wagner. In the analysis here, the contemporary, ‘quasiethnic’ reinterpretation of caste appears still to conflict with the implications of modernity. Even though caste provides actual benefits for those who employ the concept and practise it – ranging from political to economic to private – its rationale nevertheless contrasts with the motives that are generally attributed to modernity. The empirical research, employing qualitative, semi-structured interviews, participant observation, and hermeneutic interpretation of first-hand sources, produces a complex picture. The interviews with more than 70 IT employees of various caste backgrounds (including over 40 from SC/ST categories – underrepresented in the industry) indicate that caste is seemingly irrelevant in professional settings. In support of this conclusion, additional research hints at the prevalence of widespread anonymity in the IT industry and limited understanding of caste amongst IT employees. By contrast, participant observation during seven months living amongst IT engineers suggests that caste still matters: In private, the consequences of the practise of caste are still apparent, even though ritual restrictions are waning in importance. Thus, a pronounced caste-wise compartmentalisation of Indian society remains visible even amongst young IT engineers. The thesis concludes that caste is not disappearing from Indian society; rather, it is dramatically adapting to modern circumstances.