In the Sierra Sur region of the state of Oaxaca, México, high indexes of marginalization and poverty prevail. This situation is influenced by several factors, one of them being the low competitiveness of rural production units. The objective of this study was to determine the level of competitiveness of families and to identify the variables that determine it. A survey was carried out with heads of households in Santo Domingo Teojomulco and San Jacinto Tlacotepec, complemented with visits and informal meetings. The competitiveness per productive unit was quantified through the Private Cost Relation (Relación de Costo Privado, RCP), and a multiple linear regression model was formulated where competitiveness was the dependent variable. The results indicated that 83 % of the production units are not competitive, since although their net profit is positive, the added value is insufficient to cover the production factors. Competitiveness is determined by factors such as the cost of labor, auto-consumption, sales, cash expenses, subsidies and maize productivity. In order to improve competitiveness, increasing and diversifying land productivity with technological improvement is required, as well as fostering a higher level of auto-consumption and participation in the market.