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Traditionally, the social organization of the island is based on the village (desa adat), a complex network of religious, social and economic associations. Within each village are a number of banjar or neighborhoods, and within each banjar are family compounds which extend the clan beyond parents and children.

Each member of the family belongs to a number of groups. Before marriage, an individual belongs to either a boys' or girls' club, and has specific duties as a member. Upon marrying, the person then joins the banjar, the irrigation association, music clubs and various other groups, and accepts the obligations that accompany membership. In this way, every individual participates fully within the social, religious and economic framework of the village. Indeed, to the Balinese, the group rather than the individual is important. Solitude is not something that the Balinese desire, and those left alone fear visits from mischievous spirits.

Most villages are organized according to spatial orientation, and the most important points of reference are kaja (towards Gunung Agung) and kelod (seawards). Each village has three temples arranged according to these directions. The pura desa, literally the "temple of the village", stands in the centre of the village, while at the northern end of the village is the pura puseh, a "temple of origin" dedicated to the spirits of the land. Both of these temples are oriented to kaja and the sacred Gunung Agung. On the other hand, the pura dalem or "temple of the dead", as well as the village burial ground, face kelod.

On a smaller scale, the family compound is also planned in relation to the mountains and sea. The governing body of each neighborhood is the banjar, a democratic association of married men, who make all the decisions pertaining to the village. The banjar bale is the meeting place for the baniar as well as all villagers: feasts are prepared, games are held, and dances practiced. Sometimes the villagers even sleep there.

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