This article attempts to show major land use system and land reform policy adopted by the government along with agricultural performance in different periods. The methodology used in this article is based on secondary data available from different rounds of Nepal Living Standard Survey (NLSS) and Economic Survey, Ministry of Finance (MoF) of the government of Nepal. Many available kinds of literature are reviewed especially on land reform policies and agriculture development plan in different periods. The major findings of the study indicate that there is still vast disparities in the distribution of land where few people hold a large plot of land while a large number of small farmers are either landless or near landless. Most of them have 0.5 hectares of land. The concluding remark indicates that in an agricultural country like Nepal land ownership has a significant value especially for the rural poor where non- farm job opportunities are hardly available. Further, the policies and plan for developing agriculture sector are not working as per the requirement of the land-poor people and it has created social injustice and barrier in the rapid development process of the country. Due to lack of economically active manpower, most of the fertile land in the far remote area of the country is not used intensively. The poverty is linked with food sufficiency based on primary data collected through field survey.