Agriculture plays a significant role in the economic development of Indonesia. In Bali province, the government has been implementing agricultural development programs through subaks, which are customary communities that manage the traditional irrigation system. However, subaks now face some problems due to low farmers’ income from paddy farming. This paper describes the social capital performance of the subak system and attempts to identify ways to strengthen the social capital for agricultural development. The study selected the subak of Guama as its site because the government implemented a pilot project on agribusiness development in this subak in 2002. Key informants and samples were drawn during the survey and observation for data collection. Data were analyzed using descriptive methods. Results showed that social capital within the subak system consisted of mutual trust, social norms, and social networking. The three elements run simultaneously for the agricultural, irrigation, and agribusiness activities, including ritual ceremonies within the subak system. The social capital in the subak system for agricultural development, particularly rice farming, can be strengthened by: (1) conducting intensive extension and training activities using participatory approaches; (2) providing economic stimulants to encourage farmers to sustain their agribusiness activities; and (3) facilitating partnership activities between the subak and other agribusiness institutions.