The article examines income inequality in India from 2004 to 2012, focusing on different income sources. It shows that income inequality slightly increased during this period, both in urban and rural areas. In cities, regular salaried income plays a big role in income and inequality. On the other hand, farm income is the main source of income and inequality in rural areas, followed by salaried income. Regular salaries tend to increase inequality, while wages from agriculture and casual work decrease it.