This study analyzes the impact of the political changes on labor unions in Egypt in the period from 1960 to 1967. In 1960-1961 Egypt became a socialist country with one political party, the Arab Socialist Union. As a result of that development in the political arena, a wave of socialist laws were introduced by the government, affecting not only the labor unions' traditional functions, but also the industrial relations system in general. The study came to the following conclusions. 1. The role of the labor unions in the industrial relations system and especially in formulating the socialist laws was minimized in Egypt in the 1960-1967 period. 2. From an economic point of view, the socialist laws in the 1960-1967 period had restrained economic development process by reducing savings, not supplying the economy with skilled productive workers, causing inflation, and the wage structure did not work as an incentive system to stimulate productivity. 3. The socialist laws did not achieve any of their expected objectives partly because no one except the government was involved in these laws' formulation and implementation. 4. Except for the small increase in wages, the average worker did not achieve any tangible benefits that could improve his economic and social status. 5. The existence of political control over labor unions and over the industrial relations system will continue and persist as long as labor unions do not have effective leadership and as long as there is no political opposition to the government.