Economy of Nepal is highly dependent on subsistence agriculture which is characterized by low productivity and almost stagnating situation. Due to the high population pressure and shrinking of landholding size, farmers have been suffering from deteriorating household economy. Under these conditions farmers in montane area are undertaking various changes in land use and farm management in order to achieve food security. One of such changes is the cultivation of high value cash crops. Accordingly, this paper attempts to grasp how farmers try to achieve food security and improve household economy through cash crop farming, with the analysis of data collected during the field visits in 1999-2000. This analysis indicated that cash crop farming affects the production of other crops positively with efficient use of land among the cash crop farmers which enhances their food security, and allows them to allocate their income to consume more luxury items; animal protein. However, it is observed that the absence of proper linkage between farmers and government agencies prevents farmers to cultivate cash crops. Hence, it is necessary to organize farmers so that they can receive proper assistance from government and stabilize the cash crop farming.