Compensated emancipation was a method of ending slavery, under which the enslaved person's owner received compensation from the government in exchange for manumitting the slave. This could be monetary, and it could allow the owner to retain the slave for a period of labor, an indenture. Cash compensation rarely was equal to the slave's market value.

An indenture was seen as a compromise between slavery and outright emancipation, an intermediate step. However, no one was happy with compensated emancipation. Owners complained that their compensation was small compared with their loss; they were paid less, often much less, than what the slaveowner could have sold the enslaved person for (the market value). Governments and non-slaveholding citizens complained about the financial burden of compensating the owners, while for the formerly enslaved it seemed ludicrous that those who had all along benefited from slavery should now receive additional compensation, while its victims received no compensation whatsoever. Historian Eric Foner wrote, "Even Haiti, where slavery died amid a violent revolution, agreed in 1824 to pay a large indemnity to former slaveholders in exchange for French recognition of its independence.... No one proposed to compensate slaves for their years of unrequited toil." Compensation of slaveholders has been viewed as akin to compensating a thief for returning stolen property, or paying ransom to a kidnapper for releasing his victim, and therefore not so much compensation as a reward for committing what should be a crime.

To be sure, the indenture system represented for the formerly enslaved an improvement over slavery itself; those indentured could not be forcibly relocated, children and other family members could not be taken away by force, and they could no longer be whipped or raped. However, they were still not free.