It is widely believed that the distribution of the income can be made more equal through opening up of the economies of developing countries into the world market. But changes in country’s trade exposure and world market can affect negatively the distribution of resources within the country. This paper empirically explores the impact of globalization on income distribution using econometric time series approach for the period 1972-2005 in Pakistan. The results are in favor of the conventional wisdom that opening up of the economy into the international market has good effects on the distribution of income. Income inequality can be lessened through foreign capital penetration. Huge trade volume with negative trade balance must also be controlled. The process of the globalization can be beneficial for the economy but its nature should be taken into account.