Food-for-work (FFW) programs are commonly used both for short-term relief and long-term development purposes. In this paper we assess the potential of FFW programs to reduce poverty and promote sustainable land use in the longer run. There is a danger that such programs distort labor allocation or crowd out private investments and therefore have negative side effects. How important are such effects, when are these effects small and large, and when and how can they be reduced? How do technology and market characteristic and the design of FFW programs affect the long-run impact of FFW interventions? When, where and how can FFW programs more efficiently reduce poverty and promote more sustainable land management? Could FFW programs even be used to crowd in private investments? The paper attempts to provide answers to these questions, drawing on empirical evidence and an applied bio-economic farm household model for a less-favoured area in northern Ethiopia.