A watershed (catchment) is a geographic area that drains water to a common point. The Watershed Development Programme has been initiated by the Government of India and NABARD during earlier eighties with the objective of conserving soil and maximizes the utilization of surface and subsurface water for crop production. The current research was undertaken to analyze the impact of the micro-watershed on the livelihood status of people in Ramanathapuram District, Tamil Nadu. This study found that Watershed Development Programmes not only protect and conserve the environment but also contribute to livelihood security. Strengthening of community organizations within the watershed, implementation of the planned watershed management activities, encouraging linkages with other institutions and initiating groups towards the formation of apex bodies will help to motivate the people and make the Watershed Development Programme a people's movement.