In its ongoing efforts to identify more socially inclusive forms of development that target households in rural areas of Tibet, the Chinese central government has begun to focus more attention and resources on agricultural modernisation and development. Although agriculture continues to play a pivotal role in rural areas of Tibet, the nature of agriculture and rural society is changing.3 This paper first highlights some of the macro‐level changes that are occurring and some of the underlying drivers behind these changes. It then describes a model used to understand farm household systems at a micro‐level for the main agricultural areas of the Yalong river and its tributaries . The models explore the impact of agricultural innovations and changing agricultural practices on household consumption, resources, and economic returns. Although the model and analysis are still in a preliminary stage, they reveal detailed insights about the role of agriculture in the livelihoods of Tibetan farm households.