The key question of this paper is why farmers in Kosovo leave land fallow when the total land of their farms is rather small and households are rather large. In order to elicit some barriers to land utilisation in Kosovo, the paper is based on a comprehensive survey carried out in 2005 investigating agricultural households’ perceptions of production and market conditions, and employs several households and farm characteristics to empirically approximate the significance of different factors for leaving land fallow and not using it for production purposes. Three different econometric models are used expected to fit the data distribution. All estimated model specifications show a statistical significance at a satisfactory level and no severe signs of misspecification. The main determinants of the share of land left fallow by farmers in Kosovo are economic and institutional: low profitability of farming and difficulty to access inputs. The increase in incentives to farmers by improving market institutions up- and downstream is one measure which could alleviate the barriers to land use.