The Peasant is a henchman who constructs and repairs buildings in the kingdom. There are male and female Peasants, but aside from their appearance they are identical. They have no defensive capabilities and are vulnerable to attack. Peasants live in pairs - one male, one female - in Peasant Houses, which are built automatically as the need arises. When not in their house or out building, a Peasant stays in the Royal Palace. It appears that it depends on the amount of work that needs to be done at a time how many Peasants there will be in the kingdom.
Peasants are the backbone of industry. They construct and maintain the buildings in your kingdom, Your Majesty.