This stud y tri es 10 pa may the interac ti on between smallho lder agriculture and ch: n rnservice in Achcfer Voreda of Amhara Region. Different methods of data collectio n arc rnemployed 10 generale reliab le dala 10 the desc ription of th e interac tion between ext ension servIce rnand small holder agri culture. The stud y a lso rev iews th e th eoretical background and the Ethiopian rnexperience in agricultural extension. rnThe study foc lL ses on twO areas. The first area is the description and anal ysis of the soc io economi c fa ctors, which ma y hinder or facilitate the adoption of innovation. The second poinl is rnIh e socia -economic impact of extension service on sma llholder agriculture with in th e framework rno f agricultural ex tension. rnThe study identifi es land and oxen as a major constraint to the adoplion innovation. rnAlthough labour is an imp0l1anl fa ctor in smallholder agriculture, it is nol found in the kcbcle as rnbasic as land and oxen in the adoption of innovation. The local arrangemen ts in the form of rnII'OIl!cJ./emcm/ .II'ohem allows the now o f labour amon g households in crili ca llimes. Tlllwd as a rnmeans o f access to bOl h land and oxen allow th e now of Ihese resources among households. rnA/ckel/lljo as a means of access 10 oxen also has en;lbl ed the two households 10 combine thei r rnsingle ox reso urces for mutual bene fit. It argues thaI some o f local arrangements like /llIIad as rnaccess to oxen shed light on the prospect of overcomi ng oxen constraints with the proper rnadopti on of innovation. It also desc ribes c redit and Illarketin g as one of import ant factors to the rnadoption of innovation. This study identi fi es that a delay on the availability of inputs is a major rnconstraint in the adopti on of innovation. It demonstrates that agricultural extension is a very good rninstitution to improve the smallholde r agriculture in the kebcJe, though it has limitation in some rnaspects. rnThe study has also demonst rated the considerab le impacts of extension service on the rnsmallholder agriculture. It desc ribes its impact in the fonn of cultivation, Productivity. croppi ng rnpatlcms and houschold economi c imp rovelllents. It also identifies areas like agricultural rnimplement where agricultural ext ension has not yet made signifi cant impacts. Some of the rnimpacts seem to lack continuity. It :lrgucs th e need to :lddress some problems associ atcd with th e rnimp:lct o f extension servi ce 011 dietary changes and dec line of productivity. rnThe role o f the extension service in the stud y are'l in tenllS o f introduc ing beHc r natural rnresources management practices is very minimal and insignificant as compared to its impact 0 11 rncrop production. Change in the level of prod uctivity has also brought improvements in the rnhousehold economic status. The study has also identified some of the trends in socio-cult ura l rnchanges, resource utilization and hOllsehold furni ture.