Nepal, a very small country in South Asia is in a political transition phase. The declaration of democracy throwing thirty years of Panchayat political system through people's movement called first Janaandolan in 1990, brought huge awareness among the people. All deprived section of the society came on surface demanding equal participation, representation and equal access over the state resources. Indigenous ethnic groups of Nepal started cultural and social development of the community group establishing social organization targeting for the political rights. For the strong and effective voices, they alliance together and established federation called Adibasi Janajati Mahasang. Among the fifty-nine government identified indigenous ethnic groups, the Magars, the largest minority group, forming 1.8million population in the country are constructing Magar identity as a separate group inventing cultural codes. This study reflects indigenous ethnic identity construction process in Nepal in general and Magars' case particularly. This study will be very helpful to understand ethnic movement occurring in Nepal.