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Recent remotely sensed and socio-economic data of the Border Area in eastern Sudan indicate that indigenous soil and water conservation (ISWC) is expanding. The most elaborate technique is teras (bunded landholding) which uses earth bunds to harvest rainwater from small catchments. Most factors suggested in the literature to account for ISWC expansion do not apply to the Border Area. On the contrary, the region is characterised by precisely those factors which are commonly held to be responsible for a declining incidence of ISWC. Given the low level of ISWC returns when compared with incomes from other economic sectors and crop production techniques in the Border Area, the importance of ISWC must be understood from other merits. These include its role in livelihood diversification and risk-reduction strategies at household level. (C) 1997 by John Wiley & Sons, Ltd.