This paper explores one of the key issues in current research on gender and development: the links between poverty and young women's employment. Specifically, the following questions were addressed, in the context of Kerala: Which young women work for pay and why? To what extent is a woman's household economic status especially poverty status -- an important determinant of employment, and to what degree does this relationship differ for married and single women? Data for this study come from a 1997 survey of 530 women aged 18 to 35 in Trivandrum district of Kerala. The analysis provides strong evidence for a U-shaped relationship between household economic status (or class status) and women's current employment status. This is true for the entire sample and for the married women. However, in case of single women, poverty increases the likelihood of paid employment without significant effect at the upper end of the class spectrum. The interplay of economic factors (in terms of household needs and aspirations) and cultural factors (in terms of women's position in the family as unmarried daughters as opposed to wives or daughters-in-law) as determinants of women's employment is important both on the supply side of the labour market and women's ability to obtain employment in an imperfect and almost saturated labour market in the context of Kerala.