ABSTRAKKelapa sawit (Elaeis guineensis) merupakan salah satu komoditas utama tanaman perkebunan Indonesia sebagai penghasil devisa negara. Ekspansi perkebunan kelapa sawit berpotensi memberikan manfaat ekonomi, namun dapat mengakibatkan gangguan lingkungan. Oleh karena itu, perlu dikaji dampak secara ekonomi dan lingkungan akibat ekspansi perkebunan kelapa sawit. Penelitian ini menggunakan analisis pendapatan untuk mengestimasi manfaat ekonomi, analisis deskriptif untuk mengidentifikasi dampak lingkungan, dan untuk mengestimasi biaya eksternal menggunakan replacement cost dan cost of illness. Ekspansi mengakibatkan petani merubah sebagian atau seluruh kebun karet menjadi kebun kelapa sawit yang mengakibatkan peningkatan pendapatan sebesar 40,52%. Selain di sektor on-farm, petani mendapat manfaat tambahan di sektor off-farm (24,46%), dan non-farm (25,61%), sehingga total peningkatan pendapatan petani adalah 33,42%. Berdasarkan persepsi masyarakat dampak lingkungan akibat ekspansi kebun kelapa sawit berupa berkurangnya kuantitas air tanah, pencemaran air, dan berkurangnya populasi satwa. Adapun dampak lingkungan dari pabrik crude palm oil (CPO) adalah menghasilkan limbah cair dari pengolahan kelapa sawit yang menimbulkan biaya eksternal bagi masyarakat berupa biaya pengganti air bersih dan biaya berobat.Kata kunci: dampak ekonomi, dampak lingkungan, ekspansi, kelapa sawit ABSTRACT Oil palm is one of the major plantation commodity that earns foreign exchange. The expansion of oil palm plantation potentially gives not only economic benefits, but also the environmental problems. Therefore, the economic and environmental impacts of oil palm plantation expansion need to be assessed. This study uses revenue analysis to estimate the economic benefits, descriptive analysis to identify environmental impacts, and to estimate external costs using replacement cost and cost of illness. In this research, expansion is defined as the conversion of a part of or whole rubber plantation to oil palm plantation. The expansion resulted in farmers turning some or all of rubber gardens into palm oil plantations that resulted in an increase in revenues of 40.52%. In addition to the onfarm sector, farmers benefit from off-farm (24.46%) and non-farm (25.61%), bringing the total increase of farmers' income by 33.42%. Based on community perceptions of environmental impacts due to oil palm plantation expansion in the form of reduced quantity of groundwater, water pollution, and decreased animal population. The environmental impact of crude palm oil (CPO) factories is to produce liquid waste from palm oil processing that raises external costs for the community in the form of the replacement cost of clean water and the cost of illness.