Synopsis Watershed development provides not only strong conservation support to natural resource but also to create new opportunities for households to diversify their livelihood strategies. Assessing the new opportunities arising from watershed development, it is important to consider the issue of the compatibility of watershed development with existing livelihood strategies. The importance of this is perhaps best illustrated by looking at migration, which is one of the most important means of diversifying rural livelihoods for the rural poor in India. It also involves the establishment of new institutions such as watershed committees; migrants--generally the poorest--are often absent from villages and so tend to be marginalized from decisions on resource use. Thus, watershed today is a means of income--earning based with a freedom of interaction between choices of the poor for development in a resource friendly manner.