Employment in simple words can be defined as an occupation by which a person can earn his living. Whereas unemployment is the inability of providing gainful works to people who are willing to work. In economics, unemployment refers to the condition and extent of joblessness within an economy. It is measured in terms of the unemployment rate, which is the number of unemployed workers divided by the total civilian labour force. Hence, unemployment is the condition of not having a job, often referred to as being "out of work, or unemployed. Great Indian nation has a variety of its own, but the most unfortunate thing is that our country faces the serious problem of poverty. The government of India has accepted the Tendulkar Committee report which says that 37.2 % of people in India live below the poverty line. The report says that the percentage of poor in rural areas was estimated at 41.8 per cent and 25.7 per cent in urban areas (Gargi Parsai, 2011). The Saxena Committee report (2009) states that 50% of Indians live below the poverty line. The National Rural Employment Guarantee Act 2005, or NREGA, was brought into force by the government of India in February 2006 as a tool against poverty. It is the first nation-wide employment scheme that guarantees employment legally to India‘s rural population. The NREGA is being implemented in 200 most backward districts of 27 states in the country – socio - economically, the most challenging areas in India. It guarantees 100 days of unskilled jobs per rural household. More importantly, the act aims to eradicate extreme poverty and at making villages self-sustaining through productive assets creation (such as water tanks and soil conservation works). This is meant to regenerate the rural natural resource base, which in turn will result in sustainable livelihoods for residents.