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The title of the book refers to the social position of the Greasers, Ponyboy's "gang". Handicapped by their lower socio-economic status, the Greasers are looked down upon; shut out from the advantages that are open to their more wealthy counterparts, the Socs. Although members of both groups get in trouble - the Socs "jump Greasers and wreck houses and throw beer blasts for kicks", while the Greasers "steal things...and rob gas stations and have a gang fight once in awhile" - the Greasers are more frequently identified by their transgressions against the law because they come from "the wrong side of the tracks". They are the "outsiders", the ones for whom access to opportunity is perpetually more complicated, because of preconceptions and stereotypes (Chapter 1).
One of the central themes of the story, however, is that, underneath it all, the Greasers and the Socs are more alike than they are different. As Cherry Valance observes to Ponyboy, "things are tough all over", and, after talking with her, Ponyboy realizes that there are individual differences within both groups, and, despite the gulf that separates the classes, they all "see the same sunset" (Chapter 2).
The title "The Outsiders" refers to the lower class greasers that Ponyboy is a part of. They are "outside" the class of people with "all the breaks" and they have less chances to show that underneath all that hair oil they are pretty decent people too. Ponyboy finds out after talking with Cherry Valance and Randy, the differences are in the individuals not the groups. Since the Socs (the socially elite group) are well dressed and don't seem as rough, people are more quick to blame the Greasers.
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