Southernmost Kham, which borders Burma and Yunnan Province, remained at the juncture of several mutually competing political centers until the first half of the twentieth century. On the fringes of Tibetan, Naxi, and Chinese expansion and increasing political control, several Tibeto-Burman­–speaking groups such as the Drung and Nung gradually became integrated into their neighbors’ polities. Their political dependency often arose from trading with and accepting loans from commercial agents and from the intermediaries of local rulers, Naxi and Tibetans alike. This article addresses this practice of providing credit, which was developed at the expense of impoverished groups who were often obliged to accept the terms of the transaction. The author particularly emphasizes the connections between this system of debt dependency, the relationship between creditors and debtors that has to be considered in terms of exchange and reciprocity, and the question of political legitimacy. Within this broader context of regional interethnic relations, the article provides a detailed analysis of the concrete terms of the political relationship that existed between Drung communities and Tibetan chiefs of Tsawarong, which contributes to an understanding of the workings of this relationship and its economic, territorial, and even ritual components.