Bulgaria has a long tradition of smallholder farming, predominantly producing for selfconsumption. As a result of land reform and farm restructuring, many rural households received agricultural land. Some developed commercial farms but most households stayed as subsistence farmers and used their small pieces of land to produce for self-consumption and market the excess output to top up their non-farm incomes or meagre pensions. They had little capital and insecure access to markets. The paper employs semi-structured, in-depth interviews with 10 smallholders for obtaining detailed information about individuals' behaviour and exploring issues in greater detail. In particular, the study looks at the drivers of the diverse strategies pursued by smallholder farms, their importance for household food security and incomes, and the prospects of smallholder farms in the future, especially the possibilities for productivity increases. The Bulgarian study on contemporary smallholder farms shows that subsistence production constitutes a valuable safety net for households with low incomes, and therefore, it acts as an extension of the limited social security system of the country. Despite all the challenges faced by smallholders, half of the interviewed households succeeded to commercialise and increase marketable surplus. Policies for increased commercialisation of smallholder farms and a structural change in agriculture should address, besides market factors, the socioeconomic aspects which contribute to the persistence of subsistence farming. Furthermore, when prioritising different policies, the chosen livelihood strategies of the households should be taken into account.