Family farming is the most common operational farming model in Europe – representing 97 % of the European Union’s (EU) 12 million farms. Thus it is of great importance in the EU. It covers a diverse range of situations, including farms of all sizes. While there are obvious differences across regions and countries of the world when it comes to family farming, there is also much common ground. Below some of the key challenges and opportunities for family farms across the EU are identified, together with the policy solutions introduced in the EU to address them. The new 2014-2020 Common Agricultural Policy (CAP) that was agreed in 2013 offers a robust policy to maintain the rich diversity of family farms in the European agricultural sector and to ensure sustainability. The CAP continues to provide support to farmers through direct payments and measures to support agricultural, environmental and territorial development under the rural development programmes. Some of these measures are of particular relevance for family farming. Under the new direct payment regime, Member States now have the possibility to establish a simplified scheme for small farmers under which they will be able to receive annual direct support ranging from €500 to €1,250. They will be subject to reduced administrative formalities, and exempted from certain environmental obligations. Member States can also choose to pay a redistributive payment – a top-up to support small and middle-sized farms. Furthermore a scheme will specifically address the challenge of generation renewal by giving farmers up to the age of 40 an additional top-up payment for up to five years. As part of the market measures, the reform also contains measures to enhance producers’ organizations. Under the rural development elements of the CAP, the modified European Agricultural Fund for Rural Development (EAFRD) also enables spending on a raft of proven measures to strengthen the sustainability of smaller family farms through regional or national rural development programmes. These measures include support for training and advice, economic improvements (such as physical investments, business development), cooperation to overcome small-scale disadvantages (such as setting up producer groups, jointly developing short supply chains, new technologies), and compensation for environmental commitments (such as voluntarily improved environmental or organic farming standards).