This chapter estimates that there are 15 million family farms in LAC (controlling about 400 million hectares), of which 10 million are subsistence farms and the rest are intermediate and large groups with different degrees of integration with markets. Two contextual variables (local trends in growth and poverty reduction and changes in agrifood system) are then used to argue that these contextual conditions affect the potential and the performance of smallholders to a far greater extent than the size of the farm. The chapter ends with four normative conclusions: (a) it is necessary and possible to differentiate strategies and policies according to the three categories of family farms; (b) policies ought to focus also on changing the contexts in which they operate; (c) greater attention needs to be paid to domestic food markets; and (d) it is necessary to emphasise the development of public services and public goods that can work at the scale of 15 million family farms, in contrast to a focus only on a small proportion of family farmers.