This thesis is divided into four chapters which examine the principal areas of British and Italian economic and diplomatic relations in the 1 930s. Chapter One provides an outline history of Britain's financial dealings with Italy from the mid 1920s until 1939, in particular the role of the Bank of England in helping to reform Italy's financial system through, for example, the encouragement of a stable, gold-based Italian currency and the establishment of a respected and independent central bank, the Banca d'Italia. It examines the attitude of British clearing and merchant banks to the financial crisis in Italy immediately prior to the Italian attack on Abyssinia/Ethiopia in 1935, and explains their opposition to the granting of any sizeable loan to Italy. Finally, it details the policies of successive British governments to Italy's financial position, especially prior to, during and after the Italo-Abyssinian war, 193 5-1936. Chapter Two provides an outline history of Italy's important coal trade with Britain up to the early 1930s and charts and explains the loss of Britain's Italian market to Germany and other competitors. It examines the impact of League of Nations sanctions on the coal trade and reveals that this impact has been exaggerated since colliery owners were faced with large Italian debts and long delays in payment and had already begun to lose faith in Italian buyers. Additionally, it demonstrates that the colliery owners' efforts to lift sanctions and recapture the Italian market were weak and ineffectual. Chapter Three confirms that the major oil companies, including the Anglo-Iranian Oil Company (later British Petroleum) and Royal Dutch Shell, were operating a global pricefixing and shipping cartel throughout the 1930s. It describes and analyses these companies' commercial activities in Fascist Italy, especially during the period of League sanctions against Italy. It confirms the vital significance of petrol and oil to the Italian economy and war effort and analyses some of the British government's motives in not introducing petrol sanctions. Chapter Four is concerned with British-Italian diplomatic relations mainly during the Abyssinian crisis. It examines the political divisions in the British and Italian governments over how to respond to the international crisis generated by the Italo-Abyssinian war. It demonstrates that the British government helped produce a sanctions policy which gave the appearance of severity when it was, in truth, only a legitimation of an effective commercial and financial embargo which British banks and companies had already imposed. The analysis of British-Italian diplomacy concludes that the Abyssinian crisis could have been handled very differently by Britain and contained both Italian and German aggression