This paper discusses the transition from a national focus on food security during the last half of the 20th century to an emerging strategy on helping small-scale farm households increase farm income to reduce rural poverty. The basic proposition is that if extension is going to help increase farm incomes and rural employment, then it must shift from being a "supply-driven" to a more "market-driven" extension system. This shift requires at least three major institutional changes. First, extension must give higher priority to high-value, labor-intensive crops/products where there is real demand in domestic and/or export markets. Second, small-scale producers must get organized into groups to achieve economies of scale and to become linked with the "value chains" that supply these markets. Third, extension planning and decision-making must become decentralized to determine the most suitable crops and/or enterprises vis-a-vis the interests and resources of different farmer groups, in light of agro-ecological conditions and available markets for different products.