This study evaluates the effects of a market-oriented dairy development project on smallholder farm households and to identify policy options that would enhance beneficial impacts and mitigate harmful outcomes of the new technologies. Based on a sample of project participating households and a control group, the study measured the food security effects resulting from the introduction of crossbred cow technology, assessed the effect of market oriented dairy production on incomes handled by women and its consequence on them and food consumption, and evaluated the agricultural market surplus effects of intensified dairying.