Longitudinal data are required to characterise and measure the dynamics of income-related health inequalities (IRHI). This chapter develops a framework to evaluate the impact of population changes on the level of cross-sectional IRHI over time and thereby provides further insight into how health inequalities develop or perpetuate themselves in a society. The approach is illustrated by an empirical analysis of the increase in IRHI in Great Britain between 1999 and 2004 using the British Household Panel Survey. The results imply that levels of IRHI would have been even higher in 2004 but for the entry of youths into the adult population and deaths, with these natural processes of population turnover serving to partially mask the increase in IRHI among the resident adult population over the five-year period. We conclude that a failure to take demographic changes into account may lead to erroneous conclusions on the effectiveness of policies designed to tackle health inequalities.