The inverse relationship in macroeconomics for the unemployment rate and the output gap is an important feature of the labor market. Okun (1962) found that a one percentage point reduction in the unemployment rate requires an increase of three percentage point increase in the actual output growth. It is one of those rare things in macroeconomics, describes a durable relationship between two of the most important macroeconomic variables. The aim of the study is to investigate its validity and asymmetric nature for Okun’s Law for the three groups of Asian Economies for the period of 1980-2009, also to observe the effect of some other variables that manipulate the unemployment/output relationship. The classification of groups has been taken from World Bank chart that categorize the economies according to their income and region. Three groups of Asian Economies such as high income, upper middle income and lower middle income, by selecting five countries from each group have been chosen for the study. For the estimation of the cyclical output and cyclical unemployment, Hodrick and Prescott filter has been used. The nature of the economies that were under assessment in this study also offers some deeper insight into the relationship between these economic variables. The study specifies a statistically significant relationship between cyclical output and cyclical unemployment and the presence of Okun’s law for the period of 1980 to 2009 with an evidence of asymmetries with more prominent effects during the recession. However the magnitude of the coefficient estimates is different from that of the original estimates. The labor markets in the sample economies are rigid indicating the sign of persistence of structural unemployment. Supervisor:- Dr. Hasan Muhammad Mohsin