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The Richtersveld is situated in an arid environment and its inhabitants are confronted with various hazards. Based on data collected during 22 months of ethnographic fieldwork, the livelihood strategies of Richtersvelders are explored. Besides a thorough examination of the diversified economy, the internal institutional arrangements for pooling and redistributing resources within households are analysed in this paper. Encouraging household members to engage in different activities and to share their income-as well as skills to manage the household budget properly-are integral to diversification and reducing the vulnerability of households. This study has shown that even in a community marked by considerable dependence on wage labour, almost three-quarters of the households are directly involved in stock farming. Although pastoralism still plays an important role for households, it has shifted from being the core economic: activity to being an insurance against unemployment and contributing to subsistence. Stock farming serves to build up resilience through the diversification of economic activities inside the household. In the South African context, the relevance of activities dependent on land has implications not only for rural development, but also for post-apartheid land and agrarian reform. (c) 2006 Elsevier Ltd. All rights reserved.