Considering the growing importance of rural development diversifying income
through the non-farm activities in complementing proceeds of agricultural development, the
study determines the rural female headed farm households’ participation and wage in nonfarm
activities. Data were analyzed using descriptive statistics, Herfindal index, Probit, Tobit
and Heckman two-step regressions. Average rural female headed farm household consist of
seven members with income diversification level of 2.8. Education, dependency ratio and
distance to the urban centres determined the household participation in non-farm activities
while wages receive in non-farm employment were determined by hour of labour supplied,
distance to the urban centres, and education.