For Nepal, still surviving on agrarian economy, agriculture market between ruraland urban areas serves as the main linkage that shapes socio economic and ecological dynamics of the nation. Addressing the rural urban linkages is necessary because the phenomenon of urbanization in the third world like Nepal has been inevitable but unplanned. Since 80% of people in Nepal are farmers, it is impossible to analyze the nature of socioeconomic processes of Nepal without linking these processes to the rural –urban interactions between these farmers and the urban population. Detailed analysis of rural urban market mechanisms showed that urban markets show the potentials for the development of rural areas in Nepal. Agriculture market is the main source of agricultureincome for the farmers and provides a resort even to the marginal farmers when theyneed cash. However local, national and transnational forces like unequal landholding distribution, governmental policies that do not provide any economic incentives andcompetition with subsidized products from India do not support the benefit for small farmers.