The dairy sector in India is impressive in absolute terms and the nation assumed the top position from US in 2001 as the world leader in milk production. The dairy farm system in India is characterized by small scale and labour intensive operations with hand milking, low productivity and poor hygienic quality, in comparison to international standards. There are several challenges facing the milk production and collection system in order to facilitate development. Problems due to adulteration, poor training and education regarding animal health, herd management and hygiene routines at farm level in combination with a wide use of a traditional collection system without an unbroken chilling chain, represent some important issues. The concept of Community Milking Centres was introduced to Kolar district in Karnataka State in 2001 and was the first of its kind in India. The centres represent new technology to be implemented at village level including bucket milking machines and cooling tanks. The system requires farmers to bring their dairy herd to the centre and milk the cows by machine. The milk is then directly cooled and stored at the centre thereby facilitating quality control. The objective of the study is to assemble experiences from community milking in Kolar district. The study utilizes a holistic approach and intends to include the stakeholders affected by the new system; at farm, society and dairy processing level. A wide range of aspects is taken into consideration including social, economic and technical features. By surveying the impacts and outcomes facing different stakeholders, the study aspires to elicit the main issues including obstacles, opportunities, challenges and potentials. To illustrate the problem of study, the principal agent theory is used. The theory intends to explain common problem that occur in a relation with two parts where the principle hands over part of the responsibility and decision making to an agent. Research findings are based on a field study in Kolar district during June and July 2005 and cover 15 operating Community Milking Centres in the district of Kolar. Data collection has primarily been conducted through interviews. The interviews include milk producers, society secretaries, dairy employees and a veterinarian. Questionnaires, observation and participatory activities are additional research methods used. The research findings indicate a generally high level of satisfaction with the Community Milking System according to all stakeholders. The study reveals sociological improvements to be the main ones for the farmers. Decrease in human effort, increase in freedom and flexibility especially for women and the enhancement of self-esteem among farmers connected to the centres are findings of special importance. A more fair payment system and increase in transparency involving less harassment at society level are other interesting findings. Income and milk yield has not been affected to the same extent but when changes were found, they were positive. There is an obvious lack of training opportunities for farmers and society staff and demand for training widely exceeds supply. From the dairy industry point of view the concept until today, primarily has resulted in substantial increase in milk quality and freshness. Furthermore, the veterinary authorities indicate improvements in terms of the incidence of mastitis and general animal health awareness among the farmers who are linked to the new system. Simultaneously, they point out the lack of resources to provide sufficient veterinary services at all centres. To improve the concept further training of farmers and society staff is crucial, including managerial, animal health and hygiene training. Implementation of herd management systems would be desirable to enable increase in awareness and to keep track of individual cows in terms of the history of disease, milk yield, artificial insemination (AI) etc. A pilot study including only a few villages implementing a herd management system would be a possible way to develop the concept further. Farmers represent a great source of information and should be genuinely participating in planning, monitoring and evaluating such a study. The community-milking centre has a great potential to be a vital element in the process of developing the dairy industry in India.