The major objective of this study is to examine the effects of off-farm income on food security by using Treatment Effect Model. The data for 1740 rural households are taken from Pakistan Panel Household Survey (2010). The determinants of off-farm income are also explored and counterfactual analysis of level of food security of both non-farm participants and only farm participants. A food security index is constructed on the basis of the variables that affect the availability and access of food by using Principal Component Analysis (PCA). Food security index indicates that there, almost 55 percent people are food insecure in rural areas of Pakistan. Non-farm participating rural households experience almost 47 percent level of food insecurity while remaining on-farm earning households are facing 58 percent. Descriptive analysis shows that the contribution of farming sector is virtually 80 percent in overall rural employment whereas off-farm income contributes almost only 20 percent which implies that there is need of expansion in off-farm opportunities in rural areas. The empirical results indicate the positive and significant effects of off farm income on food security. Counterfactual analysis reveals that non-farm income earning farmers have higher level of food security than those who are engaged in on-farm activities. Moreover, the significance of the Inverse Mills Ratio confirms the existence of the selection bias. Demographic variables, education, dependency ratio, ownership of livestock, savings of rural households, irrigation and infrastructure variables are found statistically significant which determine both off-farm income and food security. Further, this study analyzes the cohort analysis by disaggregating data into to four age groups of farm households where impact of non-farm income on food security is also found positive. Supervisor:- Dr. Munir Ahmad