This presentation focuses on the economic and political transformations that occurred in Ifugao, Philippines soon after contact with the Spanish.  The investigation reported here is part of the Ifugao Archaeological Project, a collaborative research program that investigates the political and economic impacts of Spanish colonialism in highland Philippines, particularly, in the UNESCO World Heritage Sites in Ifugao, Philippines, where the most extensive rice terraces in the world are located. Although the Spanish colonial government never controlled the interior of the Philippine Cordillera during their 333 years of colonial rule, the economic and political transformations in the region were drastic and this was likely due to the Spanish presence in the adjacent lowlands. I utilize the concept of pericolonialism to argue that the effects of colonialism extended far beyond the areas actually colonized. By using a case study from the Philippines, my presentation focuses on the responses of indigenous peoples in the highland Philippines who appear to have resisted and/or endured Spanish cooptation. The archaeological record suggests that economic intensification and political consolidation occurred in Ifugao soon after the appearance of the Spanish in the northern Philippines. The foremost indication of this shift is the adoption of wet-rice agriculture in the highlands.  Previously, the dating of the inception of the Ifugao rice terraces was placed at 2,000-3,000 years ago.  The findings of the Ifugao Archaeological Project however, show that landscape modification for terraced wet-rice cultivation started at around AD 1600. Excavations at the Old Kiyyangan Village (Kiangan, Ifugao) also imply that the settlement had continuous contact/interaction with lowland groups and other highland groups between ca. AD 1600 and late AD 1800, refuting the idea of isolation. This work on pericolonial archaeology shows that the effects of colonialism extended far beyond the areas actually colonized.