This study examines state–society relations during Reza Shah’s reign, focusing on authoritarian modernization and the social consequences of modern state-building. Its central research question is how authoritarian modernization affected state–society relations and opportunities for social participation during this period. The research hypothesis posits that the concentration of political power and the implementation of top-down reforms strengthened modern state capacity while restricting the autonomy of social institutions and channels of public participation. Using a descriptive-analytical method and Joel Migdal’s “State-in-Society” theory, the findings identify three major dimensions of authoritarian modernization. First, bureaucratic expansion, military strengthening, infrastructure development, and administrative and educational reforms enhanced the central state’s executive capacity and facilitated institutional and social transformation. Second, political centralization and expanding government intervention constrained the relative autonomy of numerous social forces and institutions, reducing their opportunities for independent participation in political and social processes. Third, top-down modernization produced dual outcomes: although it strengthened the state’s capacity for territorial integration and reform implementation, it did not necessarily foster civil society or broaden public participation. The findings indicate a gap between the expansion of state capacity and the balanced transformation of state–society relations. Reza Shah’s experience suggests that, in the absence of effective mechanisms for participation and independent social organization, modern state-building can simultaneously promote institutional modernization and reproduce imbalances in the distribution of political and social power.