This paper grows out of earlier work on cotton by the Food Security Research Project. It is directed towards policy makers and private stakeholders in Zambia’s cotton sector, and has four main purposes: (a) To provide a detailed descriptive overview of the organization of the sector and of the behavior of key public and private participants in the sector; (b) To assess cotton’s role in smallholder livelihood strategies, and its competitiveness at the farm level with a key alternative crop–maize; (c) To critically evaluate recent policy initiatives in the sector and suggest key modifications that might be needed; and (d) To identify the primary challenges that the sector faces to ensure its future competitiveness in regional and international markets.