This study shows evidence of the impact of the Minimum Wage (MW) in Peru. We have found a negative relationship between formal employment and the MW, the employment-MW elasticity is around –0,13. Consistent with this result, in a context in which a legal increase of the MW takes place, the probability of staying occupied is smaller among low-income individuals. We also have found evidence that support the hypothesis that the MW is a referent to wage formation in the formal sector. Additionally, there is evidence that the increase in the MW in Peru in September 2003 had distributional effects in favour of low-income workers.