Italy’'s relatively small area, high population density, and high land and labor costs have created the challenges of ensuring profitably for agricultural producers, slowing urban encroachment onto arable land, and keeping farm families on land that has been handed down within the families for generations. As part of the solution to these issues, the European Union is enacting policies to reduce producer dependence on direct subsidies while increasing the competitiveness of agricultural products and returns to producers, reinvigorating rural communities, and encouraging environmentally sound production methods. These regulations provide incentives for producers to add value to their products by obtaining legal recognition of typical products, participating in agritourism, and helping to promote traditional products for regional food systems. This paper examines how E.U. and national policies are encouraging farmers in the Veneto region of Italy to adopt an agricultural production model that encourages limited production of high-quality, high-value products and more diversified land use.