The aim of the paper is to analyze the possibilities to improve the market capability of small farms in Latvia. Therefore the paper deals with the factors constraining development plans of small farm holders, the current possibilities for improving small farm market capability, the possible development strategies to choose, and proposals for the improvement of small farm market capability in Latvia. The most significant barriers to implement the development plans for Latvian small farms are the lack of the production assets and also the difficulties to attract funding for long-term investments and current assets, as well as poor market infrastructure. The existing support measures have had a positive impact on the structural changes in Latvian agriculture; however, these measures have not been sufficient to solve the problems of the market capability of small farms and to contribute to their economic growth sufficiently. In order to improve the market capability of small farms of Latvia, programmatic approach is proposed consisting of four components: 1) training, 2) development of a business plan, 3) evaluation of a business plan, and 4) implementation of the business idea. Different instruments for the implementation of business ideas are attractable depending on whether the owner has selected the implementation of full-time agricultural strategies, part-time agricultural strategies or business diversification strategies.