This paper investigates how geographically scattered labor activisms of the early 1920s Iran had a cumulative effect that led to the 1929 oil workers’ strike in Khuzestan, which in turn played a significant role in shaping governmental practices and the notions of governmental responsibility for collective welfare. Basing our research on a range of archives - including the BP Oil Company, Iranian National Archives, the British Intelligence Reports, and the Soviet archives – we revisit the emerging forms of subaltern agency and expectations, especially in the country's most significant industrial complex in Khuzestan, in order to question the notion of a passive society being coercively engineered from top by an all-powerful state. Our research sheds light on how the labor resistance during this period, especially in Khuzestan’s oil enclaves, forced the state and its agents to rethink the notions of public welfare and the spheres of governmental responsibilities - ranging from the rudiments of labor contracts, legislating workplace treatment, provision of municipal, public health, and public education services, etc. Rather than governmental elites bestowing modern spheres of social citizenship, we find these social gains to be the result of negotiated struggles (even if uneven) between the political and civil societies. The period between the two World Wars in Iran was marked by the emergence of a highly centralizing new political society, whose priority was to diminish local and tribal autonomy and enhance the interdependencies between the provinces and the center. This was accompanied by rapid urbanization and industrialization and the emergence of a new civil society characterized by non-coercive institutions such as political parties, guilds and labour unions, cultural associations and private schools. This dual process crafted a new identity for the Iranians, now being the citizens of a modern nation-state rather than subjects of a patrimonial empire. The emergence of an urban labor movement of organized and non-organized workers engaged in collective actions not only for improved working and living conditions but also for the recognition of their autonomous status as national citizens, was a clear indicator of the rise of this new demand for social citizenship. Despite rising repression, especially in the 1930s, which saw civil organizations greatly subdued, we aim to show that the collective labor and civic activisms of the earlier period left a deep and lasting imprint on both political institutions and practices as well as on public culture.