The present paper delves on the relationship that children’s milieu shares with modern schooling. Understood through the terms like out-of-school culture or community, milieu stands for children’s lives that are lived outside the educational spaces and are generally seen as abominable. The paper examines this prevalent negative sentiment that schools have towards the milieu from where children come. Instead of finding the reasons within the school, the paper advocates a philosophical and sociological lens to understand this sentiment. The work attempts to reflect those educational experiences of children should not be bereft of children’s background, as education and life are connected in ways that runs parallel to the continuity between the school and the community. It is this school-community linkage that gets articulated in the school-milieu relationship. One experiences a tension when children’s milieu or them out of school life enters in the classrooms. Hence it is important to address the nature of this tension and understand it through the lens of political economy. In the first part of the paper, the tension of milieu with schooling is traced through the lens of modernity. The second part of the paper presents the informed position that NCF 2005 has adopted towards this milieu-school relationship.