A dynamic and non-linear bioeconomic model, incorporating both economic and biophysical aspects was developed for a micro-watershed to assess the impact of key watershed management technological interventions (like HYVs and soil and water conservation structures) on social well being of rural poor and condition of natural resource base. The simulation results revealed that productivity enhancing technologies of dryland crops has increased the income for all the farm household groups and also provided incentive to farmers for conserving land resulted in less soil erosion and the nutrient mining in the watershed. The increase in the irrigated area in the watershed has improved the income of the household by cultivating more area under high value irrigated crops and has negative impact on natural resource by increasing soil erosion and nutrient mining in the watershed. The results clearly indicated that care should be taken while developing technologies for watershed development to avoid promotion of conflicting technologies. Preferably, those technologies that have multiple impacts in terms of meeting both welfare of the farmers and sustaining natural resources objectives must be prioritized.