The multi-fiber arrangement (MFA) which facilitated growth of the readymade sector in many developing countries like Bangladesh was lifted in January, 2005. Although the full impact of lifting of quota is yet to be felt, many sign of fallouts are already visible in Bangladesh. Unlike some sub-sectors that have been showing their resilience and performing quite well despite stiff competition from the giant exporters like China, a few others have started receding grounds. The implications of this loss of market have indeed been quite significant particularly in terms of employment of the poor. The present paper basically focuses on both positive and negative developments in the readymade garments (RMG) sector during the last couple of years of post-MFA regime.