Over millennia, farmers in the Peruvian Highlands have been able to domesticate a genetically diverse range of plants and animals, establish diverse production zones along vertical and altitudinal gradients, and develop technologies and land use methods to deal with altitude, slopes, and extreme climate events. These agroecological systems are currently at risk as smallholder farmers are simultaneously confronted by two major disruptions--economic globalization and climate change. Results of interviews conducted in Langui, Peru with 40 farming households and observations over a two month period show that agriculture the region is undergoing a number of adaptations. Farmers are abandoning native potato varieties and the pseudocereals quinoa and kañiwa, as unseasonal frosts and hail storms have been damaging crops in recent years. At the same time, the entry of a transnational dairy corporation into the region has given farmers the opportunity to sell milk daily, providing a steady year round income source. These two forces together are causing smallholders to transition from planting traditional staple crops, to planting improved grasses for livestock for dairy production. There is a need for balanced development strategies in the Langui district that promote market participation while allowing smallholder farmers to maintain food self-sufficiency and agrobiodiversity in the face of climate change and a changing global economy.