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In Pakistan, like many of the developing countries, crop yields under dryland agriculture are very low. This field research aimed at investigating improving land and water productivities and farmers’ incomes through improved water management, crop intensification and diversification under rainfed and supplemental irrigation (SI) conditions. With improved packages (e.g. high yielding varieties, appropriate seed rates, time of sowing, and use of fertilizers) an average of 31% higher yields of rainfed wheat (Triticum aestivum) were obtained by farmers compared to their traditional practices. The net income under the improved package was about Rs. 70,000/ha (1 US$ = Rs. 72), almost double that under farmers’ current practices. The highest wheat yield of 5102 kg/ha obtained in small plots was 28% higher than for farmers’ current practices; followed by the raised bed yield of 4776 kg/ha. With only 20% extra cost for water used as SI for small plot sowing with improved practices, there was 47% higher wheat yield and over 60% higher net income obtained compared to farmers’ practices. Similarly, with about 10% additional cost for SI, groundnut (Arachis hypogea) yield and net income increased up to four times compared to farmers’ practices. It may be concluded that, in this environment, much of the yield gap between farmers and research may be closed by adopting simple and low cost integrated packages. (C) 2015 Elsevier B.V. All rights reserved.