This paper analyses the livelihood strategies adopted by the Chepangs, a highly marginalized indigenous nationalities of Nepal. Household survey was conducted in Shaktikhor Village Development Committee (VDC) in Chitwan district and Handikhola VDC in Makawanpur district among 120 randomly selected households. Additional information was collected through participatory techniques. Six major livelihood sources were identified viz., farming, wage laboring, forest, handicrafts, skilled non-farm

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... and remittance. Farming forms the mainstay of livelihood for majority of the households. Skilled non-farm jobs and remittances are comparatively more remunerative livelihood sources, however it forms primary livelihood source for only a few households due to lack of education, assets possession, investment capital and skills. Diversification is adopted as the livelihood strategy by entire households. Combination of farming, wage laboring, and forest is the most dominant strategy although it derives lower income. This implies that the households are constrained from adopting the more remunerative livelihood options. Policies and development efforts should be aimed at improving farming, access to forest resources, and promoting non-farm opportunities for sustainable livelihoods of the Chepangs. (NIRS, 2006). 2 Khoriya cultivation is also known as shifting cultivation or slash-and-burn cultivation. In ancient times, Chepangs practiced khoriya cultivation by clearing and burning small patches of forests, which was planted with food crops usually maize, millet, and legumes like blackgram and soybean. The land was usually cultivated for a year or two at the most, and then abandoned for the next ten to fifteen years. By that time, it would have regenerated into forest and soil would gain fertility. In the meantime, they would clear other pieces of land and continue this practice. 3 VDCs are the lowest tiers of administrative units in Nepal, and are composed of 9 wards. 4 A household includes more than one individual (although a single individual can also constitute a household), who share economic activities necessary for the survival of the household and for the generation of well-being for its members (Khatri-Chhetri and Maharjan, 2006) . 5 The list of the Chepang households and the names of the household heads were first prepared with the help of the representatives of the Village Committees of the Nepal Chepang Association in the study VDCs. Then, each household was assigned a number, and the sampled households were randomly selected by lottery method. 6 The 59 indigenous nationalities in Nepal are further classified into five groups comprising of endangered, highly marginalized, marginalized, disadvantaged, and advanced group. This classification is based on a composite index comprising of variables like literacy rate, housing, land holdings, occupation, language, graduates, residence, and population size. Newars and Thakalis are the only two indigenous nationalities falling under the advanced category. The indigenous nationalities are further classified into mountains, hills and tarai based on the geographical location where they form a majority. Chepangs fall under hilly and highly marginalized indigenous nationalities, together with Baramu, and Thami (for details, see Annex 1).