The paper uses up-to-date household data from two Northern-Albanian regions. It summarises socio-economic facts on taking up remunerative non-farm employment and identifies the determinants of non-farm income diversification at the farm household level based on a binary logistic regression. Furthermore, the paper provides insight in the northern-Albanian farming structure, migration patterns, attitudes towards and reasons for income diversification into the non-farm sector. Income diversification indeed has a positive impact on the welfare of the households: A statistically significant increasing trend in incomes with rising diversification level was observed.