The cornerstone of the feudal system is that of fealty. All but the king, swear allegiance and obedience to a superior. In these relationships, a superior is referred to as a liege, and a subordinate is referred to as a vassal.

There is a common misunderstanding of the feudal system which supposes that a person of higher station is dominant of all those below his station. This is quite wrong. There is a saying that says "Your man's man is not your man". Feudalism is a strict chain of command when a person is responsible solely to their lord, whom is responsible to his lord. Even kings do not command their subjects directly. Rather they command their vassals, and down the chain it goes.

A court is a group of people that a noble keeps in his direct service in vastly differing capacities. A nobleman may have as large or as small of a court as he and his liege see fit. Ultimately those in a nobleman's court are responsible directly to that nobleman, and conduct his business in his name. Often a court includes military leaders, law enforcement personnel, tax collectors and other bureaucrats that assist the nobleman in living up to his responsibilities. For their service and as a function of their position, they have whatever powers their lord entrusts them with. They are ultimately an extension of the nobleman. He loans them his direct authority, and they do his bidding. Other members of the court are there for the nobleman's pleasure. Family, friends, entertainers and advisors are common. Generally these folk are invested with none of their lord's powers. Their lord provides an easy living for them and they provide whatever it is that the lord has taken them into his court to provide. Though these members of the court have no power, they do frequently have the lord's ear, which is no small thing.

At the top of the Feudal system is a King. The king answers to nobody. Some choose to be very active in the governing of their kingdom, and other choose to let the lesser nobles manage things more locally. When it comes right down to it, a king has dominion primarily over his dukes. In many ways, a king's primary responsibility is to act as a judge in disputes among his dukes. A king must be very fair in this, because a strong duke or two frequently have enough power to depose a king if they are of mind to do such. This generally leads to war and is not an uncommon way for a kingdom to meet it's end as other dukes choose up sides. If a king desires to retain his throne, his job is to keep his nobles content and thus loyal.

Below the king are his dukes, called princes in some lands. The land they rule over is referred to as a duchy or principality. Generally, a king has very little land and few tenants that directly belong to him. A vast majority of the kingdom is divided up among his dukes to manage. How powerful dukes are depends greatly on how controlling the king is. In some lands, dukes seem little more than the king's task-masters. In other lands, kings choose to do little and the dukes are practically little kings of their own. In many cases, one or more of a duke's close family become part of the king's court. This person serves as a liaison, but more importantly as collateral ensuring the duke's loyalty (When a duke's loyalty is in question, the lives of his family can be threatened). It is at this level that most military forces are organized. In this way, dukes generally have a large number of soldiers directly under their command.

Beneath a duke are his earls. Earls are sometimes referred to as counts. Most of a duke's lands and tenants are divided up among his earls into counties. It is at this level that a vast majority of law enforcement, courts of law and tax collection occur. Earls busy themselves in seeing that civil demands are meet. They manage building of roads, construction of bridge and enforcement of law. Generally speaking, Earls have very little autonomy. Dukes generally hold earls to high standards and seldom let them do things their way. Earls do however generally manage to have a sizable group of guards under their personal command who keep the peace locally and enforce laws. Most earls have a sheriff & magistrate in their courts who manage law enforcement efforts. Most have a chancellor, who over see tax collection.

The lowest level of nobility is the Thane, also called a Barron in some lands. Most of an earl's county is broken down into "manors", sometimes called a "demesne" or a "fief", which are generally a square mile or two in size. Thanes run these manors and generally have between 30 and 60 tenants beneath them. Thanes seldom have a court of any greater size then their family and perhaps a servant or two. Generally speaking, a thane himself is the military force that protects his manor (most thanes are considered knights, though knights can be any level of nobility or court). In the true "social contract" of feudalism, the tenants work for the nobility and the noble thanes protect the tenants. In theory, the primarily obligation of a thane is the protection of those who live on his manor. The primary function of the manor is to engage in industry, often agriculture. Most manors are dedicated to one commercial endeavor which provides a livelihood for all who live there. The thane over sees this industry and trade to keep his tenants supplied. Most thanes do their best to administer low justice and mediate disputes with tenants. Thanes generally like to give the earls little reason to get involved in their affairs. Generally speaking, Thanes have very little accountability. As long as the earls get what's due them, Thanes are pretty much allowed to run their manors as they see fit.

Those on lowest rung of the feudal social ladder are often referred to as "tenants" because thy live on land owned by noblemen. More specific legal terms are Serfs and Peasants. Prior to feudalism, this class would have been considered slaves. Under feudalism however, several rights are afforded to even the lowest man, and even a Serf is acknowledged to own himself. Peasants and Serfs are sworn directly to a lord, but are allowed to move and declare allegiance to a new lord in particular situations. Historically in most kingdoms, there was one day a year when Peasants and Serfs were allowed to leave their manor and migrate to another. Serfs are truly the lowest class. In all legal technicality, they own nothing. All of their possessions are on loan to them from their lord. Serfs are generally commoners conquered into a nation in recent generations, or have become such as punishment for crimes. Peasants, sometimes called yeoman, on the other hand are free to own property though not land. In some places, peasants can even be considered to own improvements they make on the lord's land such as homes, wells, stables and even vineyards.

Economics in feudalism is like a pyramid protection racket. A thane lets his tenants use his manor to grow crops or engage in other industry. He protects them and takes a percentage (say 50%) of what they produce. An earl goes to all of this thanes and demands a percentage (say 50%) of the produce they take from their tenants for the law enforcement, roads, etc. he provides. A duke goes to all of his earls and demands his share of the profits he has taken from the thanes. The king then demands of all of his dukes that they provide him with a share of their takings from the earls. Ultimately all wealth is produced at the tenant level and is passed up the many stages of nobility. Generally at the lowest levels this taxation occurs in the form of goods like crops and other commodities. As it goes up the noble chain, these goods are often sold, traded or manufactured into higher end goods like cloth, weapons, tools or coin. At each level, the income is used to support the nobleman himself, his court and all of the people he needs to meet his obligations.

In a feudal system, a military is formed in much the same way as funds are raised and taxes collected. A king who decides he needs 1000 new soldiers will go to each of his Dukes and require they each produce how ever many it will take to get his 1000 from among them. Each duke will go to his earls and demand that they each ante up enough to meet the demand the king has put upon him. The earls in turn go to their thanes and force them to conscript the needed number of men to pass on to their dukes. When thanes are forced to press men into military service and provide them to their earl, they are generally forced to also provide money and supplies equivalent to equip and supply the men they send. This can be an incredible burden on a thane because military supplies such as weapons are expensive. Once conscripted, soldiers are regimented, trained and uniformly equipped by the various dukes. Power struggles between a duke and a king for the loyalty and control of various military units are quite common.

Cities are a strange anomaly within the feudal system. Nobles are practically forced to experiment with open market capitalism for a city to develop. Surfs and Peasants who move to a city generally become "burgers" and are no longer required to labor in a manner dictated by a lord. Instead, a free market of sorts opens up. An old saying say that "city air breathes fee". The reason that many nobles are willing to allow this kind of freedom is simple. Money. Under a strict manorial system, agriculture and simple industry produce and trade a lot of raw materials such as crops, livestock, wood, wool and ore. The problem with this is that when a lord taxes 100 bushes of wheat, he gets 50 bushel of wheat. Sure he might be able to trade this to other manors, but all he will get are other base commodities. In a city, burgers use currency rather than trade in commodities. They form trade guilds which produce desirable products from base commodities. They pay their taxes in currency. Because they don't farm, they will buy the lords 50 bushels of wheat with currency. Without cities and the freedom there, you get little production of high end goods and little circulation of currency. If nobles want gold coins and garments rather than goats and oats, they encourage the development of cities.