I believe that Feudalism was based on the division of land by the king to nobles and vassals in return for their military service. Land was the main source of the economy and was dependent on the peasants who worked on the land.But it was due to the fact that Nobles became weaker - the Kings took back their lands and power and that more trade saw the growth of more towns.I believe that at some point in time Peasants moved away from the country into towns and realized there worth.