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General problems related to the perception of shifting cultivation and intensification scenarios are discussed. In f arming systems labelled" shifting cultivation", various types of permanent farming and offfarm activities are often more important economically than the traditional subsistence production. Based on a case study in Sarawak, the livelihood strategies of a shifting cultivation community are analysed in the context of unsuccessful Government subsidised cash crop schemes. It is concluded that the activities of the individual households mostly reflect long term strategies aimed at conserving their traditional practices and improving their livelihoods through income generating off-farm activities. Labour is identified as a key constraint to the success of cash crop prpduction from which resource poor households are unlikely to benefit. By contrast, upland rice cultivation is not only a production system but a social and religious institution which is not likely to disappear. Research and development projects shouldfocus on the intensification of this practice and on the economic use of forest and fallow. Increased output from these subsistence activities would provide a better foundation for households and individuals to choose appropriate income generating activities. Generally, in order not to counteract local strategies and waste financial resources, development programmes should be preceded by studies insuring an understanding of the livelihood strategies within target communities.