Does this sentence need to be broken up by a semi colon, conjuction, or a period? Is there a modifier error here as well?
The peasants were the least free of all people, bound by tradition and fettered by superstitions.
No, the comma is correct. Bound... is a participial phrase modifying the subject, the peasants, so it is not a clause; normally, only full clauses are set off by a colon, semicolon, or full stop.
As to why you need the comma, a participial phrase that is removed from the subject (or from whatever it modifies) is normally appositional, i.e. a kind of grammatical "afterthought", so less tightly connected to it.
Cerberus is right on spot, but I see another possible parse of the sentence. That would affect whether or not a comma should appear, but for the meaning you intend (and to me the obvious meaning), the comma should in fact be included.
The obvious intent is "The peasants are the least free of all people, {since they are} bound by....
The other possible parse is:
The peasants were the least free of {all people [who are] bound by tradition and fettered by superstitions.}
...in which case the comma would be excluded. However, that would make reading the sentence somewhat difficult and ambiguous.