Family farming is basically a system to establish a set up for forestry, agricultural, fisheries, countryside and aquaculture production. Through family farming employment generation takes place and unemployment issue prevailing in the society minimizes. The output of the family farm is high productivity and enhancement in farm income. Directly or indirectly, family farming leads to the food security situation and uplifts people’s living quality. All the rural farm families residing in district Mansehra served as the population for the study. In order to have a representation of the entire population, female respondents from the study area were drawn randomly. A total sample size of the study was 110 respondents (rural female engaged in different farming activities). Data were collected through pre-tested interview schedule and analyzed using SPSS. Results showed that an overwhelming majority of respondents (89.1%) were perceived that family farming played a significant role in improving their livelihoods on a sustainable basis. A large majority (84.6%) of respondents reported the positive role of family farming in rural livelihood development. Among different potential benefits of family farming “minimize household food insecurity” was perceived as the highest with the utmost mean (4.71/5.00). Rural female in the research area faced a number of constraints inefficient adoption of family farming practices. Out of these constraints “non-availability of female rural development practitioners/workers” was on the top with maximum mean value (4.66/5.00). The study recommended that there is a need to educate female farmers involved in family farming through extension activities to perform their activities effectively and efficiently. The major purpose of present study was to explore the constraints and potential benefits associated with family farming for livelihood improvement in the highlands of Pakistan.