New agricultural technologies are important in improving the. well-being of rural rnhouseholds in Ethiopia. However, there are many factors affecting adoption of these rntechnologies in the country. Researches dealing with adoption of agricultural rntechnologies focus on the effect of demographic, socio-economic, agro-ecological and rninstitutional factors which limit many farm households from taking advantage of crops rntechnology package in Ethiopia. However, inadequate attention is given to geographical rnand social contexts in which poverty occurs to identify factors in a give society that rninfluences farmers' decisions to adopt. rnIn this study poverty was conceptualized in Tarmab er Woreda of North Shoa following rnRobert Chambers' theory of deprivation with the objective to explore factors responsible rnfor farmers' use and non-use of improved seeds and chemical fertilizers. Here, the rnsubjective judgments of farmers about what constitutes well-being in their own rncommunities were given due attention to classify households into worse-off/poor, medium rnand better-off/rich. rnThe study was undertaken in three purposefully selected rural Kebeles of the district rnnamely Koso-ber, Yitam-na-kosta and Yizaba-na-woyin. Knowledgeable individuals from rn35 gott of these Kebeles were selected. A total of 35 key informants 'Were included to rnassign farm households in the respective Kebeles into worse-off/poor, medium and better off/rich based on such indicators as land size, livestock holdings (mainly oxen for rnploughing), the number of times that a family fe eds its members per day, housing rnconditions, land renting and/or sharecropping arrangement, household labour force rnavailability, loan status, membership of cooperatives and ability to send children to rnschool. Out of 2120 farm households, worse-off/poor, medium and better-off/rich rnhouseholds constitute 41.5%. 52.2% and 6.7% respectively. Income loss, vulnerability to rncrop failure and asset depletion, physical weakness, social isolation and powerlessness rnare locally believed causes of poverty. rnAfter well-being ranking was completed, a cross-section sample of 125 farm households rnwere selected from worse-off/poor, medium and better-off/rich households based on a rntwo-stage stratified random sampling using Proportional Probability to Size (PPS) rnmethod. The survey result shows that educational status, size of land holding, rnmembership of cooperatives, ownership of radio, how often farmers attend agricultural rnrelated programs, reading pamphlet and perceived distance of the market were found to rnbe significant positive correlates of adoption of chemical fertilizers and improved seeds. rnThe findings of this study call for the need of policy interventions. The policy that aims at rnachieving poverty reduction should consider local-level situation of poverty across sub social groups (i.e. male and female). The extension services should reinforce how rnfarmers diversify their income beyond convincing them to use agricultural technologies. rnThe family package program should be strengthened to tackle pressure of population on rnland. The public services should reach poor households in remote area. rnThis finding also suggests areas of interest like panel study of adoption decision of rnfarmers, the relationship between big population size and poverty, market failure and rnadoption of extension inputs and comparing rural households near to town with the one rnin remote Kebeles for future study in the study area.