This paper charts the evolution of business-state relations in Arabia under Ibn Sa'ud, paying particular attention to the Hijaz, which was home to the largest concentration of merchants, the center of the kingdom’s nascent bureaucratic apparatus, and the source of most of the country’s foreign exchange until the 1940s. The paper makes two principal arguments. The first is that no national alliance, developmentalist or otherwise, formed between merchants and the state in the interwar period. The second is that World War II was a major turning point for local business in Saudi Arabia, marking the state’s rise to economic dominance and the reverse of the lopsided relationship between the Hijaz and Najd. The few scholars who have examined the role of merchants in any real depth attribute too much influence and agency to the merchant community and vastly overestimate the degree to which they determined the outcomes on a national level. Merchant capital helped bankroll Ibn Sa'ud's fledgling, unsteady empire, but the vast majority of merchants were neither particularly pleased with the outcome nor involved in decisions about how their money was spent. While the largest and wealthiest merchant families in the Hijaz did have some latitude in determining local affairs, they had almost no impact on issues of national importance, financial or otherwise. They did not play a major role in politics, policy making, or administration. In fact, they often resented their position vis-à-vis the central government and were unable to staunch the flow of money from the Hijaz to Najd. At the same time, most found themselves in competition with well-connected foreign business interests in obtaining concessions and winning government contracts. Their very lack of influence, however, is an indication of the functioning and early development of the rentier state and frames the significant changes that took place during and after World War II.