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Industry in Wales was concerned with the creation of capital rather than consumer goods. The iron-making centres produced iron rather than things made of iron; the metallurgical crafts which were so important to the prosperity of Sheffield and Birmingham struck few roots in Wales.

Methods were innovative: Cort's puddling process, invented in 1784, vastly sped up the rate of iron production and was so widely adopted in Wales that it become known as the Welsh method. In copper making, the Welsh process was acclaimed as one of the finest examples of skilled metallurgical art.

The factory system of the cotton industry was often considered to be the central feature of the industrial revolution, but the development of a new form of energy through the steam engine was perhaps the more significant. In this development Wales had a central role. Bersham produced most of the cylinders used in Watt's engines; the ironworks of Merthyr Tydfil rapidly adopted the new invention; the first experiment in locomotion was made in Wales and the country contributed enormously to the supply of fuel for steam engines.

Because of its reliance on coal, steam power had an impact upon the location of industry. In the late 18th century there was a degree of industrial liveliness to be found in almost all parts of Wales. By the mid 19th century it had become apparent that it was more economical to concentrate industrial activity in coalfields where engines could readily be supplied with fuel. Thus, while industries grew prodigiously in some regions of Wales, other areas experienced an industrial revolution which ultimately failed.

Many of Wales' industrial growth regions were difficult to access. The most favoured area was the north east. Served by the ports of the Dee estuary, and close to vibrant Lancashire, it was the first region of Wales to be integrated into the general system of turnpike roads.

The mountainous coalfield of the south presented greater problems. Initially Merthyr Tydfil was linked to Cardiff by packhorses carrying pig iron in paniers. A connecting road was built in 1767 but the great innovation was the waterway.

By 1800, all the main valleys of the southern coalfield were linked to ports via canals. The ports proved inadequate. The Marquess of Bute's initiative in securing a large masonry dock at Cardiff in 1839 was crucial to the subsequent development of the town. In 1841 the dock was linked to Merthyr by the Taff Vale Railway, making it possible for Cardiff to be a major exporter of coal as well as iron. The early railway age provided a huge boost to the Welsh economy, both rural and industrial.

The southern coalfield was the only upland coalfield in Britain. Elsewhere in Wales - in the hills of Flintshire and the mountains of Snowdonia - industry also developed in high altitude areas which had previously been thinly populated. Welsh industrial communities rarely had ancient civic roots, and the shape of the settlements was determined by the contours of the surrounding mountains. They were very much frontier societies, reliant for their growth on immigration.

At least until the later 19th century, the bulk of the immigrants came from rural Wales, giving rise to a largely Welsh-speaking urban proletariat. A high proportion of the immigrants consisted of footloose young men. This was one of the factors which caused early Welsh industrial communities to be of a highly inflammatory nature. The southern coalfield was disturbed by the Scotch Cattle unrest of the 1820s, the Merthyr Rising of 1831 and the Chartist upheavals of 1839. Such communities presented life threatening risks, with the lethal danger of the mines and furnaces, and the epidemics which threatened the lives of infants.

Nevertheless, such were the deprivations of rural life that the industrial areas attracted a constant stream of migrants from the countryside. Between 1801 and 1841, Monmouthshire ranked first in the list of the most rapidly growing of the counties of Britain, and Glamorgan ranking third.