Despite being geographically small, Nepal has very diverse climatic conditions. Although topographical condition suggests Nepal has only 20 per cent of cultivable land, agriculture is still the backbone of our national economy. The agriculture practice of Nepal is subsistence and mixed farming with dominance of rural-based smallholders. Smallholder farming is a farming practice in small farms (less than 2 hectares of land; the average land holding in Nepal is 0.8 hectares per family) that relies mainly on family labour and is oriented towards production of the bulk for family consumption. Smallholder farmers constitute more than half of national population and half of the country’s total population of hungry and poor. Around 87 per cent of world’s 500 million small farms are in the Asia and Pacific region (IFPRI 2007). According to Food and Agriculture Organisation (FAO), four-fifth of developing world’s food is product of small-sized farms. These figures suggest the importance of smallholder farmers in today’s world which is staring at food crisis. Smallholder farmers of developing countries are characterised by their subsistence level of production. In Nepal’s context, these farmers lack access to credit and suffer low productivity due to inability to invest on inputs such as seed and fertiliser. Difficult geography, small land holding, climate change, poverty, illiteracy, brain drain, muscle drain, lack of market access, poor infrastructures and dominance of intermediary among others are further challenges faced by smallholder farmers. The rural farmers’ status can be uplifted by two approaches –by improving their livelihood and by increasing production of small farms. Farming by smallholder farmers is based on tradition and knowledge acquired from their forefathers, but rapid climate change is altering soil temperature, soil moisture, humidity and rainfall pattern that have made such traditional way of farming archaic, which is the main reason behind decrease in productivity of small farms. Therefore technological innovations like zero tillage, organic agriculture biotechnology and farm mechanisation can assist in increasing the farm production. Uplifting the status of smallholder farmers could largely help in achieving food security. There is an urgent need to connect smallholders to markets.