The central areas of the largest metropolitan cities in India are slowing down. Outer suburbs continue to grow but the inner city consisting of the oldest wards is stagnating and even losing population. This trend needs to be studied carefully as its implications are deep and far-reaching. The objective of this article is to focus on what is happening to the internal structure of the city post liberalization by highlighting the changing dynamics of inner-city and outer-city neighbourhoods in Kolkata. The second section provides a brief background to the metropolitan region of Kolkata and the city’s role within this region. Based on ward-level census data for the last 20 years, broad demographic changes undergone by the city of Kolkata are examined in the third section. The drivers of growth and decline and their implications for livability are discussed in the fourth section. In the fifth section, field observations based on a few representative wards are presented. The sixth section concludes the article with policy recommendations.