This article is furnished with a comprehensive review of nature and extent of rural livelihood diversification with special focus on North-Eastern region of India. This study reveals that the tribal communities of this region adopt livelihood diversification as a strategy of coping with risk due to persistent low agricultural productivity and population pressure. Despite this fact, the extent of diversification is low. Agriculture and land still occupies main source of income. It is evident from this article that this region has great potentialities of diversification towards multiple income sources. But difficult terrain and geographical isolation of this region make these resources yet to be properly utilised. The aim of this review article is to point out some issues related to livelihood diversification of North-Eastern region for further research and also try to attract the eyes of policy makers towards the potentialities of livelihood options available in this region.