In many African countries, a high proportion of the population resides in the rural areas and derives their incomes mainly from agriculture. This notwithstanding, there is a growing evidence that incomes from nonfarm employment sources are increasingly becoming important among the rural population. Using Botswana's rural household survey data, this paper examines the relative contributions and implications of agriculture and nonfarm employment to rural household incomes. Contrary to the popular held view that most rural households derive their income mainly from agriculture, the fmdings of this analysis clearly indicate that nonfarm employment is the dominant source of income in the study area. It accounted for 53% of the average total farm-household income of P4787 (1US$ = P2.49). Remittances alone contributed a substantial share of 37% and constitute an important source of income for most households in the area. On average, 40% of each household's labour force were migrant workers. As regards employment in the area, agriculture employed more than 88% of the active labour force in the villages. The relatively low contribution (47%) from agriculture implies that the potential for savings, investment and development of entrepreneur skills among most people in the area is limited. This situation is likely to encourage rapid rural-urban migration of a considerable proportion of the youth in the area. It is suggested that development strategy of Botswana government should concentrate on sustainable agricultural growth and establishment of rural enterprises to increase both income and employment shares of agriculture and non-agricultural activities, respectively, as well as rural entrepreneurship