This paper explores patterns of exit from agriculture in rural Bangladesh by utilizing nationally represen-tative repeat cross-section and pseudo-panel survey data. Our analysis focuses at the rural householdlevel where we focus on three types of households: (a) ‘‘pure” agriculture households in which all work-ers are employed only in agriculture; (b) ‘‘mixed” households in which some members remain in the farmsector and others pursue nonfarm activities, and (c) rural ‘‘nonfarm” households who are exclusivelydependent on non-agricultural employment.We find that non-farm orientation has increased over the 2000 to 2013 period, and that nonfarmhouseholds rely more on salaried employment and less on unpaid work. Pseudo-panel data based onage-cohort of household heads from the Labor Force Survey (LFS) of 2000 and 2013 also shows a notableincrease in mixed households formed by diversification of activities of formerly farm-only households.Employment patterns of younger households are changing especially rapidly: the share of mixed house-holds among households with heads age 15–30 years increased from 17% to 30% in this period. Proximityto urban areas also is associated with a rapid shift in household employment patterns over time. In areasless than 2.5 kms from cities, the share of pure farm households fell from 46.5 to 30.3 percent of house-holds, while the share of mixed households rose from 14.8 to 33.7 percent.Overall, our findings confirm a process of transformation involving a shift from predominantly agricul-ture employment to increased non-farm employment. We find that the structural transformation consid-ered does not necessarily involve large-scale permanent migration to cities. Rather, much of the shift outof agriculture occurswithinrural areas with especially rapid change happening in areas of close proximityto cities.