This study explores the impact of trade liberalization on the wage gap of skilled-unskilled workers by using the micro-level data in the manufacturing sector and provinces of Pakistan. According to neoclassical standard trade theory, it is generally believed that when economies are open narrows the wage gap between skilled and unskilled especially in developing economies (Avalos & Savvides, 2006; Wood, 1997), and contrary to H-O/SS, it widens the skilled-unskilled wage gap in developed economies (Artecona & Cunningham, 2002; Ghose, 2000; Hanson & Harrison, 1999; Yasin, 2007). Our study used a two-step estimation methodology. For estimation purposes, by following Menon and Van der Meulen Rodgers (2009), our study takes into account two approaches to examining the association between trade liberalization and the skilled-unskilled wage gap such as the log wage gap and the residual wage gap. Also, to calculate provincial tariffs we used the indicator provincial liberalization index by following the Topalova (2007). Our study found that the relationship between trade liberalization and wage gap is negative and statistical significant during the period of trade liberalization regime (i.e., 1990-2005) of Pakistan by using all approaches in the manufacturing sector. Trade liberalization increased wage gap between skilled and unskilled workers in the manufacturing sector. Moreover, our core results are robust to various trade-related controls. Furthermore, we also find that lagged trade policy is negatively associated with the wage gap. Further, we find a relationship between trade liberalization and the wage gap of skilled-unskilled in provinces of Pakistan. We find a negative influence of trade liberalization on the wage gap and statistically significant. Openness to trade increases the wage gap of skilled-unskilled in Pakistan. Our findings are robust and are not sensitive to the inclusion of other control variables such as urbanization, female labor force participation, gender disparity in education. There is also a statistically significant association between the lagged trade policy and the skilled-unskilled wage gap. Lagged police increase wage gap. Our lagged trade policy results are robust and statistically significant. Our findings provide guidelines for policymakers to open the economy because as economy open competition increase and increase the wage gap among skilled-unskilled, this can reduce by providing technical pacakage to workers that will reduce wage gap. Keywords: Trade liberalization, wage gap, skilled-unskilled, Pakistan Supervisor:- Dr. Hafsa Hina Co-Supervisor:- Dr. Jabbar Ul-Haq